After Bitcoin surged above $66,000, reaching its highest level in the past month, analysts have flagged the $68,000 mark as a critical resistance point. According to experts, when Bitcoin tests this region for the first time, it could create significant selling pressure. That’s because investors who are nearing their cost basis may start to sell.
ETF Inflows Signal Positive Momentum
Spot Bitcoin ETFs traded in the US recorded net inflows of $203 million yesterday, extending their positive streak for the sixth consecutive trading day. This brings the total net inflow since July 13 to around $779 million. Spot Ethereum ETFs also saw inflows of $37.5 million on the same day, marking a third consecutive day of positive trading. It’s a clear sign that institutional interest is slowly returning.
Why $68,000 Matters
Bitfinex analysts explained that the next significant level for Bitcoin is $68,000. They pointed out that this region coincides with the average cost level for short-term investors and the opening price of the second quarter. The analysts noted that investors who bought Bitcoin in the last five months and are still at a loss may choose to sell as the price rises back to their cost levels. As a result, a strong supply is likely to be encountered during the first test of $68,000. This could make it a tough barrier to break.
Trading Volumes and Institutional Activity Remain Weak
Vetle Lunde, Head of Research at K33, said that Bitcoin trading volumes continue to remain seasonally low. According to Lunde’s data, as of July 19, the 30-day spot trading volume was only 62.4% of the annual average. Institutional investor activity in the futures market also remains weak. Bitcoin open interest on the CME stayed below 100,000 BTC throughout July, reaching its lowest level since October 2023. This suggests that institutional participation hasn’t recovered strongly yet. While ETF inflows improved during the same period, flows were largely driven by BlackRock’s IBIT fund.
Support and Downside Risks
CapitalCom analyst Daniela Hathorn considers the $63,000 level a significant support point in the short term. According to Hathorn, if Bitcoin stays above this level and settles back above the $65,000-$66,000 range, it could strengthen the upward momentum. Conversely, a loss of the $63,000 support could lead to increased profit-taking by investors, creating renewed pressure on the price. It’s a situation worth watching closely, though nothing is guaranteed.
This is not investment advice.
