Key Takeaways:
Bitcoin (BTC), the world’s largest cryptocurrency by market capitalization, rose by 2% in the last 24 hours to reclaim the $62,000 level and is now closing in on $63,000.
Experts Say July Has Historically Been A Positive Month For Bitcoin And Crypto Markets
The leading cryptocurrency has made a positive start to July, which experts predict may be a positive period for the border market, as both BTC and Ether (ETH) have historically performed better during the month.
In previous years, Bitcoin experienced an average increase of almost 8% in July after a red candle close in June. Between 2013 and 2024, BTC had shed its value on six occasions during June, only for it to boom by at least 9.6% in July.
In a report published on Monday, analysts at QCP Capital said that Bitcoin had a median return of 9.6% in July and tends to bounce back strongly after a negative closing in June, where it fell -9.85%. They predict a bullish run for BTC this month.
Coinbase analysts David Duong and David Hand also shared the same view, stating that positive seasonality and improved liquidity could support the market in July. The case of positive seasonality is relevant as both Bitcoin and Ether have historically been shown to perform better this month, especially after a sell-off in June.
They noted that the current market setup looks supportive as a “lot of excess length” has been cleared out following the Japanese Bitcoin exchange Mt. Gox’s repayment announcement. Furthermore, market liquidity is expected to improve after daily average volumes for BTC and ETH in spot and futures markets across global exchanges declined by 16.7% between May and June, from $90 billion to $75 billion.
Mt. Gox’s $9 Billion Repayment To Creditors Could Put Price Pressure On Bitcoin
However, Bitcoin is faced with intense selling pressure this month due to Mt. Gox announcing it will commence repayments of over $9 billion in BTC and Bitcoin Cash (BCH) to creditors. JPMorgan analysts suggest that these creditors could sell parts of the Bitcoin they receive, which would initially put pressure on the market, but with the potential for recovery from August onwards.
The positive July thesis is backed by Bitcoin miners backing away from massive sell-offs. Mining entities capitulated and liquidated swathes of BTC to cover rising operational costs following the block reward halving event in April. However, that pattern seems to have slowed down heading into the new month.
Glassnode’s data suggested that Bitcoin has established support around the $60,500 to $61,600 mark. Nearly two million wallets have acquired more than 891,800 BTC, valued at $56.1 billion, making it unlikely to drop below that level.
At the same time, two major resistance walls at $64,700 and $64,550 stand between BTC and its short-term shoot back to the $70,000 range.
Global Inflation And Geopolitical Tensions Could Impact Bitcoin Price
Analysts say that the correlation between Bitcoin and macroeconomic events may strengthen even further due to global inflation and geopolitical uncertainty. The ongoing inflationary cycle, particularly in the US, and tensions in Europe and the Middle East could have a greater impact on BTC markets.
The US Federal Reserve chairman Jerome Powell is scheduled to speak on July 2nd, ahead of the Federal Open Market Committee (FOMC) meeting on Wednesday and the release of US jobs data on July 5th. A positive outcome from all three events could bolster BTC’s bullish momentum.
Bitcoin has made a good start to the month, surging to a high of $63,500 on Monday, following last week’s brief collapse to the $58,000 mark. The rally was marked by a recovery in inflows to the Bitcoin spot exchange-traded funds (ETFs), which hit $73 million in net flows last Friday. This was the highest daily inflow recorded in two weeks.
At the time of writing, BTC is trading at $62,786 – down 0.82% over the last 24 hours.
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