Bitcoin (BTC) begins the first week of July with a sigh of relief for traders as the $30,000 support holds.
BTC price action refuses to succumb to declines after 20% gains in the second quarter, with weekly and monthly timeframes looking solid. And after?
A quiet week is expected in TradFi markets, with Wall Street gearing up for the Independence Day holiday and little in store in terms of US macro data.
Bitcoin therefore needs volatility triggers from elsewhere if the bulls are to have any chance of breaking the resistance in place for several months.
Opinions from market participants are mixed on this topic – some believe that $32,000 and above is easily achievable, while others see this month as the peak of Bitcoin’s recovery in 2023.
Cointelegraph takes a look at some of the major factors that are likely to influence BTC price performance in the days and weeks ahead.
Short-term BTC price bullish calls extend to $40,000
Bitcoin’s weekly close was convenient for bulls, offering only modest volatility as BTC/USD continued to rise overnight.
The new week therefore saw a visit to $30,850 on Bitstamp, according to data from Cointelegraph Markets Pro and TradingView – the latest attempt to act closer to the $31,000 mark and yearly highs.
The fuel for a change in trend nonetheless remains absent, leading more optimistic traders to wait and see when it comes to a continuation of the upside.
“My Bitcoin plan remains the same”, popular trader Jelle summary to Twitter followers in part of his latest analysis.
“The market structure is bullish, we have recovered the 200 week EMA. Once we reach the $32,000 resistance zone, I expect the bull market to start. Until then, we trade the range and buy deeper pullbacks.
Jelle referenced the 200-week exponential moving average (EMA), which, along with its simple moving average (SMA), continues to serve as support for the market after a brief challenge in June.
An attached chart showed that the first major upside target was the current all-time high at $69,000.
Fellow Crypto trader Ed was hoping for a push towards $36,000 and even $40,000, while first considering the likelihood of a retracement to $28,000 – already a popular buy zone.
Market structure, he said, remained “good” despite last-minute volatility through the end of the month, with BTC/USD hitting $29,500.
# BTC following my plan for 36 + $40,000 so far…
Nice reactions Friday on the red and green box.
In my next YT update I will explain what I expect from here. 1 more ABC down to 28k, or just up?
Should be online around 10am CET. pic.twitter.com/Xu13Ra0mP5
— Ed_NL (@Crypto_Ed_NL) July 3, 2023
On-chain monitoring resource Material Indicators meanwhile noted the role of Bitcoin whales in maintaining the BTC price range.
#FireCharts shows that the purple whales bought dips and distributed into the range, and the mega brown whales bought liquidity at resistance to raise the range.
Historically, purple whales have had the most influence on #Bitcoins PENNSYLVANIA.
Use promo code MIJ4TH for 25%… pic.twitter.com/QE1UDypKHZ
— Material Indicators (@MI_Algos) July 3, 2023
“There is no doubt that BTC whales dispensed in the $30,000 range, but they also bought the dips that helped keep BTC in that range,” is part of a deeper analysis. added.
As Cointelegraph reported, July has never seen more than 10% losses for the BTC price, but that’s not stopping popular trader CryptoBullet from forecasting an end to bullish moves this month.
Predicting the area around $36,000 as the local high, CryptoBullet predicts that the downside – including the drop from the major moving averages – will come next.
“I’m not saying we’re going to dive to 20,000 this month or next month. Imo, it will happen in the fourth quarter,” he said. writing in subsequent Twitter comments on his original prediction.
Banks focus on losses from buying bonds
Fortunately, the macroeconomic climate is expected to be calm this week as the United States focuses on the July 4 Independence Day holiday.
Few macro data are due, and barring fewer curve events, the crypto should receive little volatility from sources such as changing inflation expectations.
Those expectations, however, remain anchored in the interest rate hikes that will return later this month, when the Federal Reserve meets to decide future policy.
As of July 3, data from CME Group’s FedWatch tool puts the odds of a 0.25% hike at nearly 90%. The decision is expected in three weeks.
“Every week looks pivotal as Fed rate expectations move rapidly. Meanwhile, stocks are hitting 52-week highs and trading has been tremendous,” financial commentary resource The Kobeissi Letter summary on the mood, calling the week ahead “short but important.”
Elsewhere, growing attention is being paid to the US banking sector.
Regional banks continue to struggle, as evidenced by the performance of the KBW Regional Banks Index (KRX).
Is this the most important chart today?
⚠️Regional US Banks Index⚠️
Fallen two-thirds and yet it can’t find a bid
Short-circuited by all, and yet he can’t catch an offer…
The 2008 monologue says the fat lady sings when it retraces 50% of her losses, $105-$110, and yet it… pic.twitter.com/ATeuxuasFG
— Hugh Hendry Eclectica (@hendry_hugh) July 1, 2023
Even Bank of America (BoA) is on the radar for its deficit bond purchases, a problem also faced by the German central bank.
“These amazing headlines don’t get enough attention,” said angel investor Balaji Srivinsan argued about an article in the Financial Times on the difficult situation of the Bundesbank.
“The central bank of the world’s fourth largest economy may need a bailout because it bought bonds. This is not a technology crisis or even a banking crisis. It’s a bond crisis, a central bank crisis, a fiduciary crisis.
Kobeissi meanwhile warned that the US banking implosions that sparked Bitcoin’s bull run in March shared key similarities with the current situation with the BoA.
Sound familiar? It is because it is.
Silicon Valley Bank and First Republic collapsed because of this.
— Kobeissi’s letter (@KobeissiLetter) July 2, 2023
Bitcoin Miners Challenge Record Exchange Transfers
Bitcoin miners highlighted the importance of BTC price action passing and holding $30,000 – but perhaps not in the way the bulls would like.
Data from on-chain analytics firm Glassnode reveals a huge increase in the amount of coins miners are sending to exchanges.
This even surpassed April 2021 levels, when BTC/USD hit $58,000 on the first of the year’s new all-time highs.
“Following the spot price’s ascent above the psychologically key $30,000 level, Bitcoin miners continued to send large clips of BTC to exchanges,” Glassnode commented.
“Currently, miners are sending $105 million to exchanges, the second largest USD-denominated transfer on record.”
Miner balances, however, maintain a slow overall upward trend in place since the start of 2023. On January 1, according to data from Glassnode, the total balance stood at 1,824,377 BTC, up from 1,827,916 BTC 2nd of July.
Despite the selloffs, there is little evidence to suggest that BTC miners are struggling. The hash rate currently remains near all-time highs, while the network difficulty is only 3.26% lower than its own all-time highs seen last month.
BTC for-profit hodlers refusing to sell
A more inspiring picture comes from the cohorts of loyal Bitcoin investors who refuse to sell, regardless of the price.
Even against the backdrop of this year’s gains, Bitcoin hodlers remain steadfast in their resolve not to take massive profits.
This is now reflected in the amount of BTC supply deemed “illiquid,” or out of reach should strong buying pressure return.
Glassnode’s Illiquid Supply Change metric is “extremely high”, currently at levels not seen except during the bear market pit of 2022. As prices have risen, so has hodler’s conviction.
THE #Bitcoins The illiquid supply change remains extremely high near cycle highs as HODLing remains predominant.
Currently, coins are flowing into illiquid wallets with little to no spending history at a rate of +194.5K BTC per month.
— glass node (@glassnode) June 28, 2023
On paper, hodlers have every reason to take profits at $30,000. Glassnode’s long-term market value-to-realized-value (LTH-MVRV) measure, which represents the profitability of coins held for 155 days or more, currently shows that the average LTH entity is making a profit of 47% on its position.
Sentiment reflects investor indecision
Finally, the nervous nature of the average crypto market participant remains firmly on display in the sentiment data.
Related: Bitcoin Speculators Send 35K BTC To Exchanges In New “Influx Of Exaltation”
The Crypto Fear & Greed Index continues to highlight how malleable sentiment depends on how Bitcoin trades the $30,000 mark.
It’s not just BTC/USD that faces a key resistance/support reversal task – Ether (ETH) also has its work cut out to recover $2,000.
As such, Fear & Greed continues to bounce between the mid-50s – “neutral” – and mid-60s, or “greed”.
Current 2023 highs for the index are at 69/100, with levels at Bitcoin’s 2021 all-time highs of $69,000 only about 10% higher.
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This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.