Bitcoin Treads water on Independence day
Bitcoin's price has been stuck around $107,000 despite several macroeconomic events that could have triggered positive price action. Here are some key factors contributing to this stagnation¹ ² ³:
- *Market Uncertainty*: The upcoming US President Donald Trump's budget bill deadline and tariff pause expiration in early July could introduce fresh uncertainty into the market, causing traders to be cautious.
- *Institutional Demand*: US-listed spot BTC ETFs recorded an outflow of $342.25 million, breaking a 15-day streak of inflows. If this trend continues, it could lead to further price decline.
- *Correlation with S&P 500*: Bitcoin's 60% correlation with the S&P 500 suggests that it should be reacting to macroeconomic developments. However, its price action has been muted, indicating a potential decoupling from traditional markets.
- *Volatility*: Bitcoin's 7-day volatility has declined to 0.79%, one of the lowest readings since October 2023. This low volatility could be a sign of a potential breakout or breakdown.
- *Investor Sentiment*: Market sentiment remains cautious, with some analysts predicting a short-term price pullback. However, others see Bitcoin's resilience as a sign of underlying strength.
In terms of price movement, Bitcoin has been trading between $107,390 and $110,039 over the past 24 hours. To break out of this range, it needs to surpass the upper consolidating boundary at $108,355 or drop below the lower boundary at $105,333. A breakout above $108,355 could lead to a rally towards $111,980, while a drop below $105,333 could trigger a decline towards $100,000.
