With increased interest from U.S. asset managers, and thanks to Ripple’s victory over the SEC, the price of BTC has held steady above the $30,000 mark for most of July 2023.
Will the bulls continue to rally ahead of the next U.S. Federal Reserve interest rate decision, which will be announced on July 26?
Can the bulls continue to rally ahead of the U.S. Federal Reserve’s next interest rate decision, which will be announced on July 26?”
Can the bulls continue to rally ahead of the U.S. Federal Reserve’s next interest rate decision, which will be announced on July 26?
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BTC kit interest has reached new heights
With a flurry of bitcoin-ETF applications from a number of major firms including Blackrock, whale demand for bitcoin has reached new heights for the second half of 2023. According to data from Santiment, the daily number of BTC transactions over $1 million is on the rise.
The chart below shows that on May 22, this figure formed a low of 943. Since then, bitcoin kits have consistently increased the number of transactions in June and July 2023.
Since then, bitcoin kits have consistently increased the number of transactions.
The 2023 high of 2,983 was updated on June 29. As recently as July 18, the figure stood at 2,571, up 172% from the May 22 low.
At the same time, the figure was 2,571, up 172% from the May 22 low.
BTC and whale transactions worth more than $1 million. Source: Santiment
The indicator of intraday whale transactions over $1 million tracks the trading activity of large institutional investors and wealthy hodlers.
A significant increase in the number of whale transactions over an extended period is usually interpreted as a bullish signal for several reasons. First, institutional investors are known to hold their investments for longer periods of time.
In addition, the liquidity of whales allows other retail investors to transact large volumes without significant price spikes. Thus, the increased demand from whales suggests that bitcoin’s rally could continue in the coming weeks.
Bitcoin inventories on exchanges are dwindling
The supply of bitcoin on exchanges is also shrinking. This is another important onchain indicator that bodes well for the recovery of the BTC price. According to analytics platform CryptoQuant, the number of bitcoins listed on trading platforms fell significantly this week.
According to data from CryptoQuant.
On July 13, the balance of exchange reserves was 2.09 million BTC. As of July 21, it had declined by 10,000 BTC.
Since July 21, it has declined by 10,000 BTC.
BTC stocks on exchanges. Source: Cryptoquant
Cryptoquant’s exchange reserves data assesses changes in market sentiment by tracking the amount of BTC transferred to leading crypto exchanges. Its decline is a bullish signal, indicating that more investors are looking to hike the coin rather than seek short-term trading opportunities.
At the same time, bitcoin’s supply shortage could push it back above the $30,000 mark soon.
If exchange reserves fall further, the resulting supply shortage in the market could push bitcoin to rebound above the $30,000 mark soon.
So, rising demand from the whales and shrinking supply on exchanges are important signs that the bulls may be able to keep the upside momentum going.
BTC outlook: the $32,000 mark remains an achievable target
In such favorable conditions, BTC looks like it could reach the $32,000 area during the next rally. However, the path to that target is covered by resistance at $30,740.
At $30,740.
As shown below, 3.18 million addresses purchased 1.43 million BTC at a maximum price of $30,740. If they choose to sell their coins at the breakeven level, the price could fall back below the $30,000 mark.
But if bullish momentum strengthens, it could form a larger accumulation zone and condition bitcoin to move towards the $32,000 target level.
BTC and IOMAP data. Source: IntoTheBlock
Nevertheless, if the market awaits a negative rate decision from the US Federal Reserve, bears could trigger a retest of the $27,000 level. However, 803,000 investors holding 547,000 BTC at an average price of $28,400 may try to defend the rally.
At this level of support, bitcoin could fall to $27,000.
If that support level doesn’t hold, bitcoin could fall toward $27,000.