As a researcher with experience in the cryptocurrency market, I believe that the Bitcoin price is currently facing selling pressure due to several reasons. The delay in the listing of spot Ethereum ETFs and the absence of expected Fed rate cuts are major contributors to this trend. The crypto market cap has taken a hit as investors have lost over $400 billion since March, reflecting a degrading confidence in Bitcoin reaching new all-time highs.
The Bitcoin price has yet to display significant upward momentum following the halving event in late April. Instead, market attention remains largely on broader economic and geopolitical issues. The introduction of spot Bitcoin ETFs in various countries, including the U.S., represents a significant transformation in Bitcoin investment. Despite the earlier anticipated three rate cuts by the Federal Reserve no longer being a certainty, experts suggest the BTC price will hover around $70,000 at year’s end.
Why Is Bitcoin Price Facing Selling Pressure
The approval of a Bitcoin ETF and later a Bitcoin Ethereum ETF significantly boosted the crypto market, leading to a notable price increase for Bitcoin. This positive development fueled optimism among investors. However, the delay in listing an Ethereum ETF has dampened the bullish sentiment, with many now expecting approval by September based on SEC Chair Gary Gensler’s latest statements.
The cryptocurrency market’s total value peaked at an astounding $2.77 trillion in March. However, since then, investors have experienced a significant loss of approximately $400 billion as the market shrank to $2.33 trillion. This downward trend is largely attributed to waning faith in Bitcoin reaching new record highs because of the postponed interest rate reductions by the Federal Reserve from May until later in the year.
Based on the data from the CME FedWatch Tool, there is a 59.5% chance that the Federal Reserve will reduce interest rates by 0.25 percentage points in September. Major financial institutions like JPMorgan, Goldman Sachs, and Morgan Stanley share this prediction, as previously reported by CoinGape.
As a crypto investor, I’m keeping a close eye on the prediction market Polymarket. According to their latest data, there’s approximately a one-third chance (33%) that the Federal Reserve will implement two interest rate cuts this year. Additionally, there’s a 32% probability, as suggested by Fed officials, for just a single rate cut.
As a researcher studying economic trends, I’ve identified several key factors that are likely to influence the Federal Reserve’s monetary policy decisions in the near future. These include the easing of U.S. inflation, upcoming elections, and rate cuts announced by central banks such as the European Central Bank. Given these circumstances, it seems plausible that the Fed will announce a policy pivot soon.
Over the past four days, there has been a decreasing influx of funds into Bitcoin ETFs, leading to a pessimistic atmosphere in the cryptocurrency market. No Bitcoin ETF registered any inflows the previous day, with Fidelity even recording greater outflows than Grayscale Bitcoin Trust (GBTC).
BTC Price Remain Range-Bound
The present price of Bitcoin is at $64,930, representing a decrease of 0.62% over the past 24 hours and over 7% within the last week. The lowest point in the previous day’s trading was at $64,066, while the highest was reached at $65,695. Notably, there has been a decrease in Bitcoin trading volume recently as investors have moved their focus towards altcoins.
Expert analysis by Michael van de Poppe on the X platform indicates that Bitcoin’s price may find support in the range of $63-$64.5k. The cryptocurrency is currently hovering between $57k and $73k, with expert expectations suggesting a continuation of consolidation throughout this week.
Bitcoin derivatives traders generally hold a pessimistic viewpoint towards the cryptocurrency. The maximum loss point for BTC options is set at $55,000 according to CoinGape’s analysis. However, it’s important to note that the implied volume in all terms has remained low. Yet, there have been indications of potential reversals emerging as the Securities and Exchange Commission (SEC) concluded its Ethereum investigation permanently.
As an analyst, I’ve observed that the total open interest in Bitcoin futures has retreated once more from its peak of $36 billion. It seems that traders are positioning themselves for another potential run at the $60,000 mark. The trading volumes in futures markets have been steadily declining for over a week now.
As a technical and on-chain analyst, I’ve identified an intriguing finding based on the MVRV extreme deviation price band metric. Specifically, when this metric registers a value of +0.5σ at a price level of $67,890, it suggests that there might be a correction towards the mean pricing band. According to my analysis, this correction could potentially occur around the price point of $54,930.
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2024-06-19 17:48