tl;dr
Bitcoin recently reached an all-time high of $123,218 before pulling back to $117,500 amid investor caution ahead of expected US inflation data showing a 2.7% year-on-year increase in June. Despite some market jitters, sentiment remains optimistic but concerns of a correction persist. Spot trading v...
Bitcoin (BTC) recently skyrocketed to a new all-time high of $123,218 before experiencing a slight pullback to $117,500. This dip reflects investor caution ahead of crucial inflation data, with the US Consumer Price Index (CPI) expected to increase by 2.7% year-on-year for June. Despite market jitters, investor sentiment remains optimistic, though concerns about a possible correction linger.
The spot market is playing a significant role in supporting Bitcoin's price. Since July 9, spot trading volume has surged by 50%, indicating robust buyer interest beyond derivatives activity, whose futures volume rose by 31.9%. Both spot and futures volumes, however, are still below the year-to-date averages by approximately 23.4% and 21.9%, respectively, revealing cautious market participation compared to earlier this year.
Examining Bitcoin’s macro momentum, IOMAP data highlights a strong demand zone between $114,000 and $117,500, where holders purchased over 189,590 BTC valued at more than $22.3 billion. This accumulation zone acts as a critical support level, making it less likely for Bitcoin to fall beneath this range. Approaching this zone could spark renewed buying, propelling Bitcoin’s upward trend while boosting trader confidence.
Currently trading at around $117,209, Bitcoin has gained roughly 9% since the beginning of the month. The market may see a brief dip to near $115,000 before rebounding towards the $120,000 level, following typical price patterns. However, looming inflation concerns could change the landscape. Should the CPI report confirm a rise to 2.7% YoY, monetary tightening might follow, which could hit risk assets like Bitcoin and lead to a deeper correction.
This scenario might push Bitcoin below the $115,000 support to as low as $110,000, undermining the bullish outlook and signaling a more pronounced market downturn. Investors should watch inflation trends closely as they weigh their next moves in this volatile environment.