Key Points
- Bitcoin is consolidating around the $70k mark with expected bullish performance due to steady ETF inflows and the upcoming halving event.
- Despite a drop in exchange outflows during this consolidation, the $75k area remains a strong magnet for Bitcoin.
Bitcoin’s price has been consolidating around a key psychological level of $70,000. This consolidation comes as long-term holders of the cryptocurrency have been relatively quiet since early April, mirroring a similar quiet period in November.
Bitcoin and Exchange Traded Funds
Bitcoin has continued to see significant inflows into Exchange Traded Funds (ETFs). A post on X (formerly Twitter) by Santiment noted that trader activity has been consistently higher since February, when demand for Bitcoin began to soar.
Bitcoin had a strong start to the week, gaining 4.8% on the day. The upcoming halving event, coupled with the steady inflows into ETFs, suggests a strong bullish performance across the market. However, the immediate aftermath of the halving event could still be turbulent.
Bitcoin Consolidation and Market Reaction
Between mid-March and now, Bitcoin’s price has mostly hovered between the $64k-$70k range. During this consolidation period, the 7-day simple moving average of the exchange outflow saw a significant drop. This drop does not necessarily indicate rising selling pressure. Instead, it suggests that the consolidation period did not coincide with accumulation from centralized exchanges.
The market’s uncertain reaction to the halving event might be a reason for this trend. However, once this metric begins to trend higher, like it did after December 18, 2023, further price gains for Bitcoin could be anticipated.
The liquidation heatmap shows that the $75k area is a strong magnet for Bitcoin. A large number of liquidations in that area could attract prices to it before a bearish reversal occurs. Alternatively, Bitcoin could also reach the $80.4k region, which is the next biggest pocket of liquidity.
The halving event presents a significant uncertainty to traders in its immediate aftermath. However, investors could expect more gains once the market settles down after the halving event.
