Bitcoin (BTC) fell toward $58,000 around Tuesday’s Wall Street open as the clock ticked down to a brutal quarterly close.
Key points:
- US stocks’ Q2 gains leave Bitcoin far behind as bulls nurse losses of nearly 20%.
- Bitcoin faces renewed pressure from the risk of Japanese government moves to support the yen.
- BTC price weakness is forcing capitulation by top buyers, says analysis.
Bitcoin “about to get spicy” amid 40-year dollar/yen high
Data from TradingView showed downside gaining the upper hand as volatility increased into the US session.
BTC/USD one-hour chart. Source: Cointelegraph/TradingView
With $60,000 increasingly looking lost as support, commentators saw the tussle between bulls and bears continuing on short time frames.
“Open Interest pumping, noticed some large longs entering on this dip, it’s about to get spicy,” commentator Exitpump wrote in fresh analysis on X.
BTC/USD order-book data. Source: Exitpump/X
Trader Killa eyed a repeat of weekly price patterns, in which Mondays formed the swing low or high of the following week.
“$BTC Keeps consolidating in this price range. Marginally higher lows and equal highs,” trader Daan Crypto Trades continued.
“Look out for whichever direction breaks first, I think a quick move should follow after that seeing how compressed this is becoming.”
BTC/USDT perpetual contract one-hour chart. Source: Daan Crypto Trades/X
Bitcoin thus reinforced its divergence from US stocks with total Q2 losses nearing 20%.
By contrast, trading resource The Kobeissi Letter noted the S&P 500 was up 14% over the quarter, marking its best performance since 2020.
“This would mark the 2nd-largest quarterly gain since the 2008 Financial Crisis recovery,” it added in an X post alongside data from Bloomberg.
“At the same time, the Nasdaq 100 is up +25%, on track for its strongest quarter in 5 years. This would also mark the Nasdaq 100’s 2nd-best quarterly performance in 25 years.”
US stocks performance comparison. Source: The Kobeissi Letter/X
Kobeissi described an “accelerating” global stocks rally, with the US providing the impetus.
In a potential headwind for crypto, the US dollar hit new multidecade highs against the Japanese yen, increasing the odds of government intervention.
USD/JPY reached 162.50 on the day, its highest since the mid 1980s.
USD/JPY 12-month chart. Source: Cointelegraph/TradingView
“Whether it’s Japan, India, South Korea or MSTR, It’s the same problem,” analyst and YouTube personality George Gammon summarized to X followers on the day.
“You’ve got dollar liabilities and not enough dollars. So you sell assets to get dollars putting downward pressure on the asset. Yen, Rupees, Won, or Bitcoin.”
Bitcoin hodlers “appear to be cutting losses”
In new research, onchain analytics platform CryptoQuant warned of a fresh round of Bitcoin investor “capitulation.”
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At sub-$70,000 levels, contributor Crypto Sunmoon warned that those who had bought BTC around all-time highs were now selling at a loss.
“Since the break below $70K, exchange inflows have risen sharply, with the majority of this volume consisting of coins held for roughly six to twelve months, coins most likely accumulated near the cycle highs,” they wrote in a Quicktake blog post.
“This pattern is consistent with capitulation among cycle-top buyers, as holders appear to be cutting losses rather than continuing to hold through the drawdown.”
Source: CryptoQuant
CryptoQuant data showed onchain movements increasingly involving coins that last moved around all-time highs, along with increasing inflows to exchanges.
“For some, this will be a painful stretch. That said, capitulation events of this kind among cycle-top investors have historically coincided with long-term bottom formation, a pattern observed in both the 2018 and 2022 cycles,” Crypto Sunmoon added.