Despite this, several indicators now suggest that the cryptocurrency may have bottomed out, with the potential for a rebound in its price trajectory.
Here are five key bullish signals that point towards a possible resurgence in Bitcoin’s market performance.
1) Bullish Divergence: Despite recent declines, Bitcoin has shown a bullish divergence with the Relative Strength Index (RSI) trending upwards. This divergence suggests that while prices have fallen, selling pressure may be weakening, hinting at a possible reversal or slowdown in the downtrend.
Source: Cointelegraph
This could pave the way for a rebound as market sentiment shifts back towards bullishness.
2) Technical Indicators: On July 5th, Bitcoin formed a bullish hammer candlestick pattern, a classic indicator of potential price reversal.
Additionally, the daily RSI is hovering near oversold levels, typically preceding a period of consolidation or recovery. Analysts interpret these signals as potential signs that BTC could revisit previous highs above $70,000.
Source: X
3) Interest Rate Expectations: Traders on Wall Street are increasingly anticipating a September rate cut by the Federal Reserve, with probabilities rising to 72% as of July 7.
Lower interest rates typically favor riskier assets like Bitcoin, as they reduce the attractiveness of traditional safe-haven investments such as US Treasury bonds.
Source: CME Group
4) Bitcoin ETF Activity: US-based Bitcoin ETFs have seen renewed investor interest following weak unemployment data on July 5.
These funds collectively attracted $143.10 million worth of BTC inflows, indicating growing risk appetite among institutional investors. Notably, the Fidelity Wise Origin Bitcoin Fund led with $117 million in inflows.
Source: Farside
5) US Money Supply Expansion: The recent uptick in the US M2 money supply, which measures cash, checking deposits, and near-money, suggests increased liquidity in the economy.
This liquidity often translates into higher investments in riskier assets like Bitcoin, as investors seek higher returns amidst lower yields from traditional savings and bonds.
Source: X
Conclusion
These five bullish arguments collectively suggest that Bitcoin may have hit a bottom around the $53,000 mark and could potentially see a rebound in the near term. While market volatility remains a factor, particularly amid regulatory developments and global economic trends, the current indicators point towards a possible strengthening of Bitcoin’s position in the broader financial landscape.
Disclaimer
The information discussed by Altcoin Buzz is not financial advice. This is for educational, entertainment, and informational purposes only. Any information or strategies are thoughts and opinions relevant to the accepted levels of risk tolerance of the writer/reviewers and their risk tolerance may be different than yours. We are not responsible for any losses that you may incur as a result of any investments directly or indirectly related to the information provided. Bitcoin and other cryptocurrencies are high-risk investments so please do your due diligence. Copyright Altcoin Buzz Pte Ltd.