Retail Interest in Bitcoin Dips to a Five-Month Low: A Sign of Upcoming Resurgence?
Summary:
Retail demand for Bitcoin has hit a five-month low, reaching levels previously seen in January prior to a 75% increase in value over the subsequent two months. Axel Adler, CryptoQuant author, suggests this downturn in interest could lead to another surge in value. The decrease in the US Consumer Price Index could make riskier assets like Bitcoin more appealing to investors. Despite a recent fall in Bitcoin, traders hope a swift recovery will occur, particularly with the release of the June 12 inflation data.
Retail interest in Bitcoin (BTC) has slumped to a five-month low, resembling the stagnation witnessed in January, preceding a subsequent 75% appreciation over the next two months. The latest data published by Axel Adler, author at CryptoQuant, shows that the average monthly shift in Bitcoin interest among retail investors - classified as those transferring up to $10,000 - has sunk to negative 17% over the preceding 30 days. Adler notes that Bitcoin's value skyrocketed from $40,000 to $70,000 after a comparable decline of 18% was recorded in January, following the endorsement of spot Bitcoin exchange-traded funds (ETFs) in the United States which catapulted Bitcoin to its all-time high of $73,679 by mid-March. Adler observed that this particular group responds rapidly to any market flux. Previously, Adler's metrics revealed a 31% fall in demand over the 17 days leading up to May 24, falling to negative 14.50%, as GameStop (GME) and Ether (ETH) attracted investors’ attention, likely sparked by the preliminary approval of spot Ether ETFs. Experts have attributed variations in Bitcoin demand to multiple factors, including the US Consumer Price Index (CPI) which tracks inflation. When the CPI slips, riskier assets such as Bitcoin might seem more attractive to investors given that conventional savings and term deposits yield less lucrative returns as interest rates decrease. Markus Thielen, the chief researcher at 10x Research, speculated in May that a CPI dip to 3.3% on June 12 - the date the Bureau of Labor Statistics (BLS) releases the data - would trigger Bitcoin to resurrect new all-time highs. On June 11, Bitcoin fell below its November 2021 record high of $69,000, a price point closely monitored by traders. As of this writing, Bitcoin's price stands at $67,350, reflecting a 3.19% reduction over the last 24 hours according to CoinMarketCap data. This abrupt downturn erased $52.87 million worth of Bitcoin long positions in the last day while Open Interest (OI) maintains above the highly regarded $35 billion mark, per CoinGlass insights. Although traders were hopeful of a swift Bitcoin recovery beyond the $70,000 mark after the slump on June 8, it does not seem imminent. In light of the CPI results due to be announced on June 12, future traders seem less optimistic about a near-term recovery, risking $2.14 billion in short positions if it springs back. As a disclaimer, this content does not provide investment guidance or recommendations. Every investment or trading actions carry risk, and readers should conduct thorough due diligence before making a decision.
Published At
6/12/2024 6:41:37 AM
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