Bitcoin bears have been consistently selling during any uptick in the past few months, but analysts are optimistic that a surge in liquidity triggered by BTC’s recent record-breaking highs could help disrupt this pattern.
“The market is in dire need of a significant liquidity boost,” wrote Daan Crypto Trades, a pseudonymous crypto trader, in a post on social media platform X on June 13. This observation follows Bitcoin’s erratic price movements as it hovers within a broad range spanning from $66,500 to $72,000.
According to the trader, the market has been plagued by substantial selling pressure and a trend of selling off every rally for the past few months. Breaking this cycle, the trader believes, can be achieved through the attainment of a fresh all-time high for Bitcoin.
Current data from Cointelegraph Markets Pro and Binance indicates that BTC is currently trading at $67,474, which is 10% lower than its peak of $73,808 recorded on March 11.
Daan Crypto Trades expressed confidence that Bitcoin’s price could surge rapidly without the need for external catalysts, emphasizing the importance of high liquidity. This liquidity allows traders to purchase more BTC, tightening the bid-ask spread and propelling prices upwards.
A potential surge in liquidity could come from MicroStrategy, the largest corporate holder of BTC, who recently announced plans to raise $500 million through a convertible senior note offering to acquire more Bitcoin and for general corporate purposes.
Reacting to this news, Daan Crypto Trades remarked, “That’s a fresh $500M liquidity impulse for you right there,” highlighting the positive impact this could have on the market. Additionally, increased inflows into spot Bitcoin ETFs could further contribute to the liquidity needed to break Bitcoin out of its consolidation phase.
Despite these developments, Bitcoin’s price remains range-bound within a post-halving re-accumulation range, as suggested by popular analyst Rekt Capital. The analyst believes this phase could extend until September 2024 but remains optimistic about a potential upward breakout.
Market intelligence firm IntoTheBlock’s In/Out of the Money Around Price (IOMAP) model indicates strong support in the $63,500 to $67,500 range, with a significant number of addresses having previously purchased Bitcoin at these levels. On the flip side, a substantial barrier exists between $67,600 and $70,500, where a large number of addresses have previously sold BTC.
In conclusion, while there are signs of high demand-side liquidity required to push Bitcoin’s price past resistance levels, readers are reminded that this article does not provide investment advice and that all investment decisions carry inherent risks. Conducting thorough research before making any investment moves is recommended.