Bitcoin’s price has recently dropped below $65,000, influenced by a sell-off from the German government and outflows from Bitcoin ETFs. While major players like MicroStrategy continue to buy during dips, overall market sentiment remains cautious as the year’s first half concludes, bringing significant volatility.
According to Santiment, there is widespread fear and disinterest among traders toward Bitcoin as its price fluctuates between $65,000 to $66,000. Despite this fear, when traders sell off their holdings and big investors buy-in, the market often bounces back, rewarding patient investors.
Top Reasons Bitcoin Bears Reigned
German Government Sell-Off
The bearish trend in Bitcoin’s price can be linked to the German government’s selling spree. Data from Arkham Intelligence shows that Germany transferred $65 million worth of Bitcoin to exchanges like Coinbase, contributing to the downward pressure. This follows a previous transfer of $130 million to exchanges including Kraken and Bitstamp. These actions stem from Bitcoin seized from the piracy website Movie2k.to in 2013. Right now, they still hold $3.05B in BTC.
ETF Outflows
Alongside government sell-offs, Bitcoin ETFs have experienced significant outflows, further contributing to the price decline. This lack of investor confidence has added to the bearish sentiment in the market.
Nvidia Impact on BTC
In contrast to Bitcoin’s struggle, the US stock market, particularly driven by tech giants like Nvidia, is performing well. Nvidia’s market cap has surged to $3.4 trillion, surpassing France’s GDP and the entire crypto market. This stock market strength, alongside speculation about the US Federal Reserve potentially cutting rates before November, could provide some hope for a recovery in the crypto market.
Buying the Dip
Despite the bearish trends, large entities like MicroStrategy are capitalizing on the lower prices, indicating a belief in a future bull run. However, the broader market, including traders and institutions, remains pessimistic for the time being.
What next in BTC Price?
Interestingly, after a strong rejection at $72,000 earlier this month, Bitcoin’s price has seen a decline, correcting over 10% from its June high. Losing crucial support levels, Bitcoin now risks dropping to $60,000. According to historical trends, Bitcoin miner capitulation often continues for months post-halving. Analyst Willy Woo highlights that Bitcoin’s price recovery depends significantly on weak miners exiting the market and the subsequent hash rate recovery.
Conclusion
With the latest price action, the bears have demonstrated huge dominance as the Bitcoin price slipped below the major support. On the other hand, the traders and institutions do not appear to be optimistic, while the whales are preparing for the upcoming bull run, which is yet to begin.
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