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In summary
- According to 10x Research, the market is absorbing several factors before potentially resuming an upward trajectory in Bitcoin.
- BRN analyst Valentin Fournier noted that Bitcoin ETF inflows have taken a temporary pause, but accumulation is still seen at the current price level.
- Alex Kuptsikevich, senior market analyst at FxPro, warned that Bitcoin is close to a key support level at $66,800, and a break below could pave the way for a deeper correction.
Bitcoin (BTC) appears to be entering a stabilization phase with indicators suggesting traders are entering a period of accumulation.
Analysts are looking at the moderately positive news despite price fluctuations that have seen the top Cryptocurrency trading at $66,300, following a 0.7% drop but maintaining a 7% gain over the past two weeks.
Meanwhile, Ethereum is down 2% to $2,570, although it has also seen a 5.5% increase over the past two weeks, according to data from CoinGecko.
Market analysts point to several key factors that support this stabilization thesis. Circle’s $1.7 billion USDC drawdown has been more than offset by significant liquidity indicators, including substantial stablecoin inflows totaling $38 billion this year, notably outpacing the $21 billion that has flowed into Bitcoin Spot ETFs.
According to 10x Research, the market is absorbing several factors before potentially resuming an upward trajectory. “Rather than becoming overly bearish, we believe the market needs time to digest higher bond yields before Bitcoin can resume its upward move,” 10x Research said in a note to Decrypt.
They highlighted that while funding rates for Bitcoin and Ethereum have increased to 10%, spot prices have lagged and retail participation remains moderate. “We would like to see multiple indicators aligned to confirm bullish momentum, but this is not a significant concern. The market will likely only need a few days to absorb these factors.”
Added to this, total stablecoin inflows have been a key driver of liquidity this year. “With $36 billion in stablecoin inflows since the launch of the Bitcoin spot ETF, liquidity remains strong,” noted 10x Research, highlighting that these inflows continue to put upward pressure on the price of Bitcoin.
BRN analyst Valentin Fournier also pointed to institutional activity as a key indicator.
“After a streak of seven consecutive days of ETF inflows totaling more than $2 billion, Bitcoin ETF inflows have taken a temporary pause,” Fournier explained. “While this indicates a slight decline in institutional demand, we are still seeing accumulation at the current price level, suggesting a potential bullish trend once the market consolidates.”
Fournier also noted that although Bitcoin has retreated to $67,000 after being stopped at the $70,000 resistance level, this softer rejection suggests that traders are accumulating in preparation for a bullish advance. “The upcoming US presidential election, potential interest rate cuts and global stimulus efforts could push cryptocurrencies to new highs in the coming weeks,” he added.
However, Alex Kuptsikevich, senior market analyst at FxPro, urged caution as Bitcoin remains near a key support level. “Bitcoin is close to a local support level at $66,800. A break below this support could open the way for a deeper correction towards $65,500,” Kuptsikevich said.
Despite the recent correction, he emphasized Bitcoin’s dominance in the market, noting that BTC’s share of the cryptocurrency market capitalization has increased to 57.3%, the highest since April 2021.
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