Bitcoin is trading at $ 36,786 and is making gains on the 7-day chart after two straight weeks of losses. On the 30-day chart, BTC is still showing a 32.3% loss. Price action is moving painfully up in the current range, but without the bulls’ conviction.
BTC is trending down on the daily chart. Source: BTCUSD Tradingview
The crypto market appears to be stagnating after the BTC price crash. The fight was waged by short-term holders selling their coins to long-term holders, but institutions were largely absent during the correction.
Data from CryptoQuant suggests institutional demand for the Grayscale Bitcoin Trust (GBTC) and the launch of the Bitcoin Fund in Canada by mutual fund manager 3iQ is declining.
As can be seen below, the GBTC has seen a negative premium and has been trading at a discount since March 2021. This caused discomfort and concern among their customers and Grayscale’s parent company, Digital Currency Group, was forced to intervene. The company had to buy several million GBTC shares.
In contrast to the Canadian QBTC, the GBTC has held its Bitcoin. The QBTC reduced its holdings to 7,980 BTC in early June. This creates selling pressure in the crypto market, as can be seen below.
The general market sentiment was negative despite the news of the takeover by the nation states. At the beginning of the current week, the price of BTC has developed positively. This coincides with a decrease in the GBTC discount from 12% to 7%.
As Lex Moskovski, CIO at Moskvski Capital, has shown over the past 2 days, the number of addresses accumulating BTC has increased after a period of consolidation. However, the selling pressure has not eased, as suggested by the surge in BTC inflows into the exchanges.
Source: Glassnode via Lex Moskovski
Will Bitcoin Bulls manage to push back the bears?
At the moment, the price of Bitcoin could still be characterized by uncertainty and no clear direction. As a report from QCP Capital notes, the BTC sell-off was “deeper and sharper” than expected.
Source: QCP Capital
The sale has been in 3 waves since the beginning of May. The market could see another sell-off, but in the form of consolidation, as the company claims:
it looks like BTC is setting a bottom up for the Wave 4 rally. However, this wave 4 will most likely be a slow, steady consolidation.
Bitcoin faces two challenges in the short term: It has to convert USD 38,000 from resistance to support and overcome the “huge” wall at USD 40,000. The Bitcoin thesis as a store of value seems to be weakened in the short term, as the low institutional participation suggests. Therefore, there is less demand for the cryptocurrency.
(…) All three bull cases for BTC have been invalidated and it is difficult to make a bullish fundamental argument to buy BTC now. We continue to expect the downtrend to continue and the market to be in sell rally mode at least for the short term, and when wave 4 goes above $ 40,000 we expect the $ 50,000 to have an even bigger sell offer.
QCP Capital expects the Consumer Price Index (CPI) and the Open Market Committee (FOMC) meeting to be short-term risk factors for the price of BTC.
it was last month’s CPI pressures coupled with a confluence of a few other factors that sparked the great BTC decoupling.
The company sees potential for price decline below $ 30,000 and expects $ 20,000 to be strong support if this scenario occurs.
11 / The BTC price is likely to remain capped until the end of the year. The market seems to have leveled off somewhere between fear of the downside and a wait-and-see approach. Retail volume has thinned out and movements of whales dominate the price action
– QCP Capital (@QCPCapital) June 9, 2021