Bitcoin experienced a brief relief bounce following the Federal Open Market Committee (FOMC) minutes from July, which hinted at possible rate cuts by some policymakers. This led to a short-lived rally where Bitcoin briefly tested $61,000. However, the overall sentiment in the market has remained subdued.
August marks the fifth consecutive month of price consolidation for Bitcoin, leading to increased speculation about whether the cryptocurrency can achieve a new ATH anytime soon. According to Peter Brandt, the extended duration of the current market cycle could signal that Bitcoin may have already reached its peak for this cycle.
“Current bull market cycle in $BTC will soon become the longest time post-halving in history for a new ATH or could indicate that a new ATH is not in the cards,” Brandt stated.
Despite Brandt’s cautious outlook, other market analysts offer a more positive perspective. Benjamin Cowen argues that Bitcoin is progressing in line with historical market cycles. According to Cowen, the cryptocurrency is currently positioned where it typically is at this stage of the market cycle.
“Despite everything, #BTC is right around where it always is at this point in the market cycle,” Cowen observed.
Similarly, Ki Young Ju, founder of CryptoQuant, suggests that Bitcoin could be poised for the next leg of its rally, potentially starting in Q4. Ju points to historical trends where Bitcoin’s bull runs have often intensified during the final quarter of the year.
“In the last #Bitcoin halving cycle, the bull rally began in Q4. Whales won’t let Q4 be boring with a flat YoY performance,” Ju predicted.
Several indicators support the possibility of a Bitcoin rally. Recent data shows a drop in funding rates alongside an increase in open interest rates, which K33 Research interprets as a potential setup for a short squeeze.
“Market conditions are looking ripe for a short squeeze. BTC perps notional open interest has jumped by 30k BTC since August 13, with consistent negative funding rates,” K33 Research noted.
Additionally, Glassnode has reported that Bitcoin’s Long-Term Holders (LTH) have reduced their profit-taking activities. Historically, this trend has been associated with new price uptrends for Bitcoin.
On the flip side, CryptoQuant highlights a potential challenge: Bitcoin’s inventory on over-the-counter (OTC) markets has reached a two-year high. This increase could dampen Bitcoin’s recovery in the short term, as historical trends suggest that rising OTC balances are often linked to declines in Bitcoin prices.
“Bitcoin OTC Desk Balances Soar to Two-Year Peak. Historically, increases in #Bitcoin OTC desk balances have been associated with declines in Bitcoin prices,” CryptoQuant reported.
In summary, Bitcoin’s potential to reach a new ATH remains a topic of debate. While Peter Brandt’s analysis casts doubt on the likelihood of a new peak in the current cycle, other experts see favorable conditions for a rally, especially if historical trends hold true.
The cryptocurrency market’s dynamics are complex, with multiple factors influencing Bitcoin’s price trajectory. As Bitcoin navigates through these turbulent waters, investors and enthusiasts will need to closely monitor both technical indicators and market developments to gauge its future direction.
Julie is a renowned crypto journalist with a passion for uncovering the latest trends in blockchain and cryptocurrency. With over a decade of experience, she has become a trusted voice in the industry, providing insightful analysis and in-depth reporting on groundbreaking developments. Julie's work has been featured in leading publications, solidifying her reputation as a leading expert in the field.
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