Bitcoin Price Analysis: Here’s the $4.4 Billion Signal Driving BTC to $60k

Bitcoin Price Analysis

Bitcoin price rebounded 9% over the weekend, briefly reclaiming the $58,450 level on Sunday, July 7, but recent outflows BTC from exchanges suggest that investors are bracing up for bullish activity in the week ahead.

Bitcoin Price Rebound Halts at $58,500

The global crypto market witnessed brief surge in demand after dovish US Non-Farm Jobs released on July 5, which fell short of analysts feared inflationary prediction.

Over the weekend, Bitcoin price rebounded from the 130-day low of $53,542 recorded during the market meltdown on Friday. Recent on-chain movements suggests investors could be preparing for more upside in the week ahead.

The chart above shows that Bitcoin price rose 9% from the 130-day low of $53,542 to hit the $58,467 level on Sunday July 7. But as demand weakened BTC price dropped 7.04%, retracing back to $5 at the time of writing on July 8.

Investors Shift BTC Worth $4.4B into Long-term Storage in 3 days

This rising volatility shows intense market activity, and growing investors interest after a turbulent start to July 2024. Looking towards the on-chain data trends, investors seem to be shifting large volume of coins into long-term storage, a move that could cool the selling pressure on Bitcoin in the days ahead.

CryptoQuant’s Exchange Reserves chart shows the changes in the number of bitcoin currently deposited of recognized crypto exchanges and trading platforms.

Bitcoin investors held a total of 2,848,539 BTC in exchange-hosted wallets as of July 4, 2024. Following the dovish Non-Farm Payroll (NFP) report releases on Friday, July 5, investors have been shifting large volumes of BTC into long-term storage options. This movement indicates a significant change in investor sentiment and strategy in response to macroeconomic factors.

At the time of writing, the number of BTC exchange reserves has dropped to 2,768,449 BTC. This reduction of approximately 80,000 BTC in exchange reserves over a short period suggests that investors are increasingly opting for long-term holding strategies, amid the hostile market volatility.

This trend is often seen as bullish because it implies that investors have confidence in Bitcoin’s future value and are less inclined to sell in the short term, reducing the immediate supply available for trading.

More so, when valued at the current Bitcoin price, the 80,000 BTC outflows means that investors have removed BTC worth over $4.4 billion from the short-term market supply on exchanges.

With fewer Bitcoins available on exchanges, the immediate selling pressure decreases. This reduction in available supply can lead to higher prices if demand remains constant or increases.

Also, the movement of BTC to long-term storage options suggests that investors have strong confidence in the future prospects of Bitcoin. This shift is often a sign that investors expect positive developments or price increases in the long run, leading to a more bullish sentiment in the market.

Bitcoin Price Forecast: $55,000 Support to Hold Firm

The current price of Bitcoin (BTC) is $55,149.90, reflecting a 1.28% decrease for the day. Recently, Bitcoin has experienced a significant decline, losing 7.04% over the last day and 9.21% over the last two days. The price is now well below the 9-day Arnaud Legoux Moving Average (ALMA) at $56,565.83, indicating bearish momentum in the short term.

The Commodity Channel Index (CCI) is at -170.18, which is deep in the oversold territory. This suggests that Bitcoin may be due for a potential short-term reversal if buyers step in at the current price levels. However, the continued bearish sentiment, as indicated by the declining CCI, implies that caution is warranted for immediate bullish trades.

Key support levels to monitor are $55,000, which is a critical psychological level, and $54,000 below that. These levels could act as a floor and provide strong support if the price continues to decline. On the upside, the immediate resistance level is at $56,500, aligned with the ALMA. A successful break above this level could signal the beginning of a recovery, potentially leading to a retest of the $57,500 resistance level. In summary, Bitcoin is under pressure but the $55,000 support level is crucial to holding firm to prevent further declines.