Bitcoin (BTC)
$116,663 experienced a decline after reaching a peak of 123,000 dollars in mid-July, dropping to 112,000 dollars within a fortnight, slipping below a crucial supply zone concentrated at 116,000 dollars. Glassnode data revealed that approximately 120,000 BTC were exchanged during the downturn on July 31, and the price has yet to recover previous support levels. The same data pointed to the steepest exits from spot ETFs since the end of April, paired with a reduction in leverage usage. Experts note that maintaining levels below the 116,000-dollar threshold could diminish short-term investor confidence.
Increasing Pressure on Short-term Bitcoin Investors
Bitcoin acquired one to three weeks ago holds an average cost near 116,900 dollars, acting as a resistance to further rises. The proportion of assets held by this investor group in profit fell from 100% to 70%, moving into the typical mid-cycle band. Yet, a further decline poses the risk of increasing the unprofitable supply. Glassnode assessed, “As the correction deepens, the supply in loss may rise, gradually weakening confidence.”
The significant volume of 120,000 BTC on July 31 indicated buying interest at lower prices despite a lack of support. The market continues to tread a cautious path, and potential large-scale sell-offs are anticipated primarily from short-term traders taking profit from the July peak. A return to the 110,000-dollar level is part of short-term expectations.
ETF Exits Increase while Leverage Usage Declines
On August 5, 1,500 BTC were withdrawn from U.S. spot Bitcoin ETFs, marking the most substantial daily exit in three months. This negative trend reversed by mid-week with a net influx of 91.5 million dollars. Major players like BlackRock, Bitwise, and Grayscale managed the majority of ETF demand. Nonetheless, analysts caution regarding potential new exit waves striking ETFs.
Conversely, the funding rate in futures markets dropped below 0.10%. Data from Derive.xyz indicated a dip in the 30-day option curve into negative territory, suggesting investors were hedging against downside movements. Glassnode noted neither a capitulation scenario nor strong recovery expectation and summarized the situation as marked by uncertainty post-historic highs.
Bitcoin Price Analysis and Commentary
According to data from CryptoAppsy, as the news was being prepared, Bitcoin was trading at 116,455 dollars with a 2.14% rise over the last 24 hours. Despite this rebound, attention is drawn to the price movement still below the 116,900-dollar resistance, coinciding with news of Donald Trump’s executive order today, permitting 401(k) retirement plans to invest in alternative assets like private equity, real estate, and cryptocurrencies.
