Despite starting the year with very strong performance levels, even managing to surpass its own previous all-time high, Bitcoin was ultimately unable to gain momentum and continue growing.
In spite of the rise of the exchange-traded funds and the halving, performance levels have been quite stagnant overall, with BTC struggling to reconquer its record levels but ultimately falling short of achieving this goal.
According to Binance, the Bitcoin price is still fluctuating, and there’s no denying the fact that it is far stronger overall compared to the last two years. That means that the king of crypto will continue aiming for the all-time highs as its performance becomes more robust.
The fact that BTC is currently taking longer to evolve and grow could also be seen as a very clear indicator that it is becoming a mature asset class, one that won’t be so easily swayed by momentary volatility.
8%
Many investors and analysts believe Bitcoin is entering an era of price discovery, a process through which sellers and buyers can establish spot prices. Bitcoin finished the penultimate week of July with an explosive price growth episode, with the weekly close stopping at a very cozy level somewhere slightly above $68K.
Many of these movements come from difficult situations that marred the United States presidential elections. Although volatility existed in both directions, the fact that the BTC/USD pair approached the all-time high levels of 2021 is a good sign. This is the highest level Bitcoin has recorded since June 12th and roughly 8% away from all-time highs.
Analysts discussed the fact that this trend is very advantageous for bullish investors, with the possibility here being that $65,000 will act as a support level in the future. Such an elevated foundation could support climbs to higher price points in the future, being a reliable method through which the bulls will be able to maintain control.
The relative strength index metrics also show that an upswing is imminent. Fibonacci extension levels have also demonstrated similar results, indicating the potential for further growth. It might just be that Bitcoin will shortly break its own records once more.
German Bitcoin
Around mid-July, the German government got rid of all of its BTC, with its wallets currently showing a balance of exactly zero. Opinions based on the effect of this movement differ, but everyone is convinced that such a massive endeavor will certainly leave its mark on the highly reactive cryptocurrency space.
In fact, it is very likely that BTC itself will not be the only coin dealing with the effects of this decision. While some believe that an upward trend is likely, others are convinced that a downward one is much more probable.
Historical trends show that prices usually follow liquidity movements and trends. The fact that a former exchange embroiled in controversy for roughly a decade has just begun repaying what it owed to its customers has also been seen as a possible issue for the blockchain and its investors.
So far, though, it seems that any extreme losses have been averted and are unlikely to become a reality anytime soon. However, that doesn’t mean traders should abandon their strategies, as volatility is still very much a possibility.
The miners
Bitcoin miners are an essential part of the blockchain, as they facilitate the creation of new coins and ensure transactions can be validated accordingly. In the aftermath of the April halving, there was a lot of talk about the fact that, for many, the activity would become unprofitable, and there would be no incentive to continue mining at all.
Now, analysts believe that those worries could come to an end and be replaced by a capitulation period that could last for several months. This scenario typically occurs when the near-term hashrate becomes comparatively low. The 30-day moving average tends to go below the 60-day one as well.
Phases such as this are nothing new and have, in fact, been quite common in the Bitcoin ecosystem over the years. Interestingly, they sometimes occur during bullish markers as well. However, the majority of investors are far more interested in the price recovery that follows rather than the process itself.
The last capitulation phrase ended around August 2023, so it has now been a whole year since the marketplace last had to deal with these conditions.
In the aftermath of the previous capitulation, the value of the BTC/USD pair almost doubled despite a momentary dip to the $25,000 level. The hashrate associated with the mining process has also reached the highest levels over the past couple of months, exceeding 690 hashes per second.
The bears
Most market researchers appear convinced that the next few months are firmly in the hands of the bulls, so what about the bears? How have they been faring during this period? Data indicates that, at least for the time being, this investor base has lost its ability to dictate the market narrative.
Social volumes for terms such as “bearish” and “sell” are diminishing. However, the bulls are not yet 100% confident with the positions, afraid that mishaps could still happen and the price trajectory could take an unforeseen turn.
During the final days of July, it appears that the bearish community has nonetheless gone silent due to the pretty strong rebound that governed the marketplace during these days.
Moreover, those who were convinced that the month would be under the control of a bearish tendency appear to have revised their predictions. Right now, the market sentiment appears to be getting increasingly closer to greed territory, measuring 70/100.
The Bitcoin market has been going through a lot of ups and downs over the past few years. However, it has maintained its position as the king of crypto and the most important digital asset on the market.
If you’re an investor, it’s essential to remain aware of market changes even when an upswing is in the works. This is the best way to guarantee your portfolio is safe and can continue growing. It’s easy to see riskier activities as attractive, but you should always ask yourself if the potential capital losses are truly worth it.
