When is the next Cryptocurrency crash?: Bitcoin market prediction

After trading at a pricing value of $53,550, in the first week of July,  Bitcoin saw a jump of 26% and is currently trading at $67,936. In the past 24 hours, Bitcoin witnessed a surge of 1.5%.

Bitcoin market trends: 

These  technical and onchain trends give a hint of an expected sharp correction. This surge has been a result of growing spot Bitcoin exchange-traded funds (ETF) inflows and exhaustion from sellers.

When Bitcoin plummeted to approximately $53,500 recently, a significant number of short-term holders found themselves facing losses, contrasting sharply with long-term investors who barely experienced any decrease in profitability.

According to Glassnode’s report, just 2.6% of long-term Bitcoin holders, defined as those who have held the cryptocurrency for over 155 days, were at a loss when the price dipped to $54,000.

This category primarily consists of individuals who acquired Bitcoin during the 2021 bull run, when it peaked at its record high of $69,000 in November of that year.

According to Glassnode’s Percent Supply in Profit metric, 75% of the Bitcoin supply is currently in a profitable position. The metric notes that such levels have historically been observed during corrections in previous bull markets. As long as this metric remains above 75%, a majority of the Bitcoin supply will likely continue to be in profit.

A substantial amount of Bitcoin held in profit is often viewed as a sign of fear of missing out (FOMO), which typically occurs before or during price corrections. Based on this blockchain-based signal, Bitcoin’s price could experience declines in the coming days if long-term holders decide to realize their gains.

Conversely, positive economic indicators from the United States, particularly heightened speculation on Wall Street regarding a potential interest rate reduction in September, could provide a tailwind for Bitcoin’s bullish recovery.

As per the CME Fedwatch Tool data on July 17, futures traders have significantly raised their projections for a 25 basis point rate cut in September to around 93.5%, up from 67.3% just 10 days earlier.

Elections and Crypto mania:

After an attempted attack on former President Donald Trump on 13th July, Bitcoin surged to a two-week high on Monday 15th July.

In the upcoming November U.S. election, former President Trump is competing against Democratic incumbent Joe Biden. Trump has criticized Democratic efforts to regulate the cryptocurrency industry. At a fundraiser in San Francisco in June, Trump positioned himself as a supporter of cryptocurrency, although he has not yet outlined specific details of his proposed crypto policy.

Bitcoin ETFs inflows

Bitcoin’s recent rise in value aligns with significant weekly investments totaling $1.347 billion into funds tied to Bitcoin, including spot Bitcoin exchange-traded funds (ETFs) in the United States. Farside Investors’ data indicates that on July 16 alone, 11 US-based spot Bitcoin ETFs recorded $422.5 million in net inflows, contributing to a total of $723.4 billion in cumulative net inflows over the past two days.

When it comes to other technical aspects, Bitcoin price is fighting resistance from the $66,000 level. It’s noteworthy that when the price broke through this level on June 18, it suffered a significant 20% decline to $53,500, indicating vigorous defense by bearish investors in this particular zone.

Thus, a question like: When is the Next Cryptocurrency Crash?, does offer one with different standpoints, however, it is best recommended to do one’s own research and invest wisely in the cryptocurrency market.