Bitcoin Heatwave to End: Met Office Signals Top
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- Bitcoin surged 40% in the past month, pushing its relative strength index above 80 for the first time since 2021.
- Historically, such readings precede sharp pullbacks, with average drawdowns of 25%.
- On-chain data reveals profit-taking by long-term holders, with spent output age bands showing 3-6 month coins moving to exchanges.
Bitcoin surged 40% in the past month, pushing its relative strength index above 80 for the first time since 2021. Historically, such readings precede sharp pullbacks, with average drawdowns of 25%. The Met Office's heatwave-ending prediction mirrors this cooling pattern.
On-chain data reveals profit-taking by long-term holders, with spent output age bands showing 3-6 month coins moving to exchanges. This supply influx threatens to overpower demand, especially as ETF inflows slow. Institutional buyers are now sidelined, waiting for lower prices.
Macroeconomic pressures compound the short-term bearish outlook. The Fed's hawkish stance on rates and a strengthening dollar reduce risk appetite. Crypto markets historically correlate with liquidity cycles, and the current tightening phase suggests a summer slump ahead.
Power Move: Smart money is already hedging: options skew shows increased put demand for July expiry. The heatwave's end isn't a crash but a recalibration. Buyers should target the $55k-$58k zone for re-entry, where support aligns with the 200-day moving average.
This article was edited with AI assistance for readability. Read original here.
