Price Analysis
  • Steve Muchoki
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    Steve is a crypto news writer with a passion for decoding market moves. He blends breaking blockchain news with sharp technical analysis and bold price predictions. From Bitcoin rallies to altcoin breakouts, Steve breaks it all down with clarity and insight. Whether you're a trader or just curious, his analysis keeps you ahead of the curve.

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    Bitcoin Demand Wanes: Fakeout or Parabolic Rally Ahead?

    Story Highlights
    • BTC price has teased $100k amid easing geopolitical tension in the Middle East.

    • On-chain data analysis shows the overall demand for Bitcoin has significantly declined amid positive cash flow to ETFs and MSTR.

    Bitcoin (BTC) has experienced reduced demand, especially from institutional investors despite the apparent net cash inflows in the last few weeks. According to on-chain data analysis provided by CryptoQuant, the net demand for Bitcoin has been falling in the recent past.

    Precisely, the overall demand for Bitcoin has contracted significantly, such that people purchasing Bitcoin reduced their demand by 895k coins in the past 30 days. The reduced Bitcoin demand amid significant cumulative short leverage trades has played a major role in its midterm bearish sentiment in recent weeks.

    Bitcoin demand growth

    Bitcoin Price Gains Bullish Momentum 

    After closing above a crucial resistance level around $108,360 on Wednesday, Bitcoin (BTC) price rallied towards the next milestone of around $110,570 on Thursday, July 3. Consequently, the flagship coin has regained the 50-day SMA as a support level and is now aiming to retest its all-time high of nearly $112k.

    Furthermore, BTC price has invalidated the previously formed falling trend after closing above the upper border of the logarithmic trend. According to market data analysis from CryptoQuant, the selling pressure from U.S. whales and institutional investors, has gradually declined.

    Bitcocin coinbase premium gap

    What the Charts Say

    BTC price is approaching to retest the all-time high around $111,814, which signals a potential double top if a rejection occurs. With the daily Relative Strength Index (RSI) signaling a possible bearish divergence, it is prudent to wait for the BTC price to consistently close above $112k in the subsequent days to avoid being caught in a fakeout. 

    BTC Price analysis

    The daily MACD indicator also shows that the bullish sentiment has been gaining momentum, whereby the histograms have been increasing above the zero line. The bullish momentum is also bolstered by the fact that BTC price has registered more positive monthly returns in Julys in the past ten years.

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