With the wave of cryptocurrency accumulation by listed companies, BTC's new high has 'arrived as expected.'
As the financial market pays close attention to the direction of the Federal Reserve's monetary policy, on July 9, during the late trading hours of the US stock market, Bitcoin broke through the previous high of May 22, refreshing its historical peak to nearly $112,000 (CMC data at $111,925.38), with a daily increase of nearly 3%.
The Federal Reserve's June minutes released signals of potential interest rate cuts.
The June meeting minutes released by the Federal Reserve that day also brought complex but suggestive information to the market.
The minutes show that there are significant divisions within the Federal Reserve regarding the outlook for monetary policy, which can be divided into three main camps:
Mainstream camp: Most participants assess that it may be appropriate to lower the federal funds rate target range this year, but ruled out the possibility of an immediate rate cut in July. They generally believe the committee 'is fully capable of waiting for a clearer outlook on inflation and economic activity.' The minutes noted that the upward pressure on inflation from tariffs may be temporary or moderate, with medium to long-term inflation expectations remaining stable, and some weakening in economic activity and the labor market may occur.
Hawkish camp: A minority of participants believe that the federal funds rate target range should not be lowered this year, pointing out that 'recent inflation data continues to exceed the committee's 2% target.'
Dovish camp: A minority of participants (with 'Fed mouthpiece' Nick Timiraos suggesting it could include Fed governors Waller and Bowman) indicated that if data developments meet their expectations, they would be willing to consider lowering the policy rate target range at the next meeting.
Despite internal differences, the signal that 'most participants assess that a rate cut may be appropriate this year' undoubtedly strengthens the market's expectations for future liquidity easing, which is a positive macro catalyst for risk assets like Bitcoin.
Long-term Bitcoin holders have reached a 15-year high in holdings.
This breakthrough of Bitcoin is not without foundation. Recent on-chain data from ARK Invest and Glassnode shows that there is a strong 'ballast' force in the Bitcoin market - long-term holders (LTHs).
ARK Invest's latest (Bitcoin monthly report) indicates that the total amount of Bitcoin held by long-term holders has reached 74% of the total supply, marking a new high in the past 15 years. This strongly suggests the firm belief and strong bullish expectations of experienced investors in the market, who choose to accumulate Bitcoin rather than sell as prices rise, providing strong support for the market.
Glassnode's data also corroborates this trend. Over the past five years, Bitcoin's balance on exchanges has seen two sharp declines, and each time the decline was followed by a significant rise in Bitcoin's price. Notably, since July 2024, Bitcoin's balance on exchanges has been steadily decreasing. This indicates that investors are withdrawing Bitcoin from trading platforms into private wallets for long-term holding, reducing market selling pressure. If history repeats itself, Bitcoin's bull market still has further room to run.
Although the ARK Invest report also mentioned that the MVRV momentum indicator measuring market sentiment showed a decline in on-chain capital flow in the second quarter, which may indicate a cooling of short-term market enthusiasm, the firm stance of long-term holders provides a solid foundation for Bitcoin's price, making it more resilient to short-term fluctuations.
Bitcoin's 'bull flag' breakout points to higher targets.
Several well-known analysts have also expressed optimism about Bitcoin's upside potential from a technical perspective.
According to TradingShot analysts, since hitting bottom in November 2022, Bitcoin's price has been in a clear upward channel, which highly corresponds with the Fibonacci channel tracking Bitcoin's price movements since 2013. Analysts believe Bitcoin has turned the previous 'bull flag' top into a support level, which is a 'strong bullish signal,' and the price continues to hold above the 50-day simple moving average (SMA) of $106,750.
TradingShot further predicts that the technical breakout from this 'bull flag' points to the 2.0 Fibonacci extension line, with a target price potentially reaching $168,500.
In addition, renowned trader Zerohedge pointed out on the X platform that if Bitcoin can follow its fractal pattern with M2 money supply, then once the current consolidation period ends, Bitcoin's price will enter a parabolic rise. This potential correlation between macro liquidity and Bitcoin's price adds a more optimistic tone to the current market.
Glassnode found that the current cycle has similarities with the bull markets of 2017 and 2021 - in both cycles, Bitcoin's price started a parabolic rise at a similar point in time as now and lasted nearly a year. This suggests that if historical patterns repeat, Bitcoin still has significant room for growth.
Crypto analyst Rekt Capital also noted that if Bitcoin follows the historical pattern of 2020, the price expansion of this cycle may only have a few months left, and its price could peak in October, about 550 days before the Bitcoin halving event in April 2024.
Bitcoin's new historical high is the result of multiple factors resonating, including macro benefits, institutional adoption, and listed companies accumulating coins. The expectation of interest rate cuts from the Federal Reserve injects ample liquidity into the market, and the firm holdings of long-term holders build a solid price bottom. From the current market momentum, its upward trend is far from over, and the second half of the year may witness a stronger acceleration.
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