Bitcoin has been rejected at $79,000 three times in eight sessions. The level now defines the range.
Bitcoin traded at $76,923 on Tuesday morning, down 2.4% over 24 hours after climbing to $79,399 on Monday and reversing during the day. Ether fell 3.7% to $2,290, XRP fell 3.2% to $1.39, Solana fell 3.9% to $84.10, and BNB fell 1.8% to $625. The entire top 10 closed in red over 24 hours outside of Tron and Dogecoin.
Brent crude rose 1% above $109 a barrel, extending its rise to the seventh day after Iran’s proposed interim deal to reopen the Strait of Hormuz failed over the weekend. The White House said US officials were discussing the latest Iranian proposal but were maintaining “red lines” on any deal to end the eight-week war.
The MSCI Asia Pacific Index was little changed, with Japanese stocks supported by the Bank of Japan’s split 6-3 decision to keep policy unchanged. The yen strengthened 0.3% to around 159 per dollar.
Two Bitcoin band readings are circulating among market analysts.
Galaxy Digital’s Mike Novogratz said in a note that U.S. retail investors have returned to the market and the combination of retail demand, institutional capital and limited supply is creating the basis for further upside. Data from Santiment shows that whales have accumulated more than 40,000 BTC in the past two weeks, and the company reported a sharp shift in sentiment from fear to fear of missing out over a short period of time.
Analytics firm CryptoQuant takes the opposite view. Founder Ki Young-Ju said in an article
Perpetual futures funding rates on major exchanges remain negative on a 7-day basis at -0.13% per Coinglass, meaning shorts are still paying longs to hold positions, the pattern that historically precedes squeezes and the unwinding of squeezes.
The two views are not mutually exclusive. Spot demand from retail and institutions could return just as the rally toward $79,000 was initiated by short covering. The test is whether the next attempt at the level will bring new spot bids or whether there will be no more shorts to squeeze.
Despite everything, corporate accumulation continues. Strategy purchased $3.9 billion worth of bitcoin in April according to Bloomberg, the company’s largest monthly accumulation in a year.
Japanese company Metaplanet on Tuesday announced a $50 million bond offering to finance new bitcoin purchases, the latest in a series of yen-denominated debt deals the company has used to build one of the largest corporate bitcoin hoards outside the United States.
The catalysts of the week arrive Wednesday and Thursday.
The Federal Reserve announced its policy decision Wednesday, with traders weighing the odds of a rate cut after the Justice Department closed its investigation into Fed Chairman Jerome Powell.
Megacap tech profits from Alphabet, Microsoft, Amazon and Meta on Wednesday and Apple on Thursday represent about a quarter of the S&P 500’s market capitalization.
The Fed or a sharp rise in earnings could provide the catalyst needed to push bitcoin to $80,000. Without this, the third rejection of the level begins to define the upper end of the range rather than preceding a breakout.
