1alt HD: ETF Turnaround Proves Insufficient to Trigger True Macro Bullish Turnaround for Bitcoin Traders
Bitcoin [BTC] was struggling to scale the $65k local supply zone. Since July 14, the spot Bitcoin ETF inflows have been positive. The injection of capital has not been enough to substantially elevate prices yet.
Source: CryptoQuant
Crypto analyst ScenarioX noted a steady drop-off in the 30-day Bitcoin spot demand. The metric recovered to -80k BTC in early July, but has since deteriorated to -170k BTC, the analyst explained in a post on CryptoQuant Insights.
Despite decreased demand, prices have stayed relatively stable around $65k because of short-covering in the derivatives market. Easing short-term holder sell pressure was also a contributing factor.
AMBCrypto reported that the turnaround in ETF flows was not enough to confirm a bullish reversal. A reading of the short-term price structure highlighted the importance of the $67.3k local swing high.
Lack of new investors growth signals stabilization, not reversal
Source: Axel Adler Jr.
The Bitcoin New Investors metric remained near its yearly lows. It measures the share of capitalization concentrated among coins younger than 1 month [not moved in a month or less].
Crypto analyst Axel Adler Jr. used this metric to gauge new capital activity and short-term demand. The analyst observed a reading of 8.1, with the lower boundary at 7 and the upper at 50.
This meant an increase in new capital, but not in enough strength to point toward a BTC trend reversal.
Source: Axel Adler Jr.
Further evidence of a local stabilization instead of a reversal came from the short-term holder spent output profit ratio [STH SOPR]. The metric measures the average profitability of short-term Bitcoin holders.
Its 7-day moving average was at 0.99, below the 1.0 mark that separates profitability from realized losses.
A sustained recovery in the metric above 1.0 would signal market sentiment has shifted. As things stand, the lack of significant participation from new capital and short-term holders realizing losses meant that bears were still in control.
Final Summary
- Bitcoin has not yet found the momentum to take prices above the $65k-$67k local supply zone.
- The bounce toward $65k was only a brief respite from selling, and not the beginning of a bullish recovery, the metrics showed.
