Bitcoin traders are bracing for a potential bearish trend in the near future, despite positive developments in the equity market and crypto-friendly policies in the United States. This cautious outlook is fueled by selling activity from miners and general profit-taking.
Experts suggest that the selling pressure from miners could limit Bitcoin’s upward potential. Data from mining pools shows a notable increase in the transfer of BTC to exchanges, which is often a precursor to selling. This trend has raised concerns among traders about a possible price correction in the coming weeks.
Alex Kuptsikevich, a senior market analyst at FxPro, highlighted the current market conditions, noting a shift in demand towards traditional assets like the U.S. dollar and equities. This shift, coupled with ongoing testing of key support levels, has set the stage for a potential drop in Bitcoin’s price, with a $60,000 target looming large.
The recent behavior of miners, who play a critical role in the Bitcoin network by providing computational resources, has also caught the attention of analysts. Since the halving in April, miners have been facing increasing cash demands, leading to a gradual decline in their net position. While this may not directly impact Bitcoin’s price, it could contribute to price stagnation in the short term.
On-chain data from CryptoQuant further supports the narrative of increased selling pressure, with a surge in BTC transfers from mining pools to exchanges. Professional over-the-counter desks have also reported heightened selling activity, indicating a potential shift in market dynamics.
Despite a brief price surge following a milder-than-expected U.S. CPI report, Bitcoin quickly retraced its gains amid revised rate cut forecasts from the Federal Open Market Committee. The broader cryptocurrency market has also witnessed significant losses, with major tokens like BNB, XRP, and SOL declining by over 10% since Monday.
Ether, the native cryptocurrency of the Ethereum network, has faced additional scrutiny, with some analysts suggesting a more bearish outlook compared to Bitcoin. Unless Ether can reclaim key support levels soon, further downside could be in store for the token in the short term.
In summary, the current market conditions point to increased volatility and uncertainty for Bitcoin and other cryptocurrencies. Traders are advised to exercise caution and closely monitor key technical levels to navigate potential price fluctuations in the weeks ahead. While long-term prospects for Bitcoin remain positive, short-term challenges could test the resilience of the market.