BTC demand cools after Fed’s presser and volatility ramps up

The key take-aways

• After a 62 day buying spree, Bitcoin’s Coinbase Premium has turned negative.

• BTC is still above $115,000 in spite of rising selling pressure and negative CVD futures.

Bitcoins (BTCCoinbase Premium Index turned The market has been negative since May 29 after 62 consecutive days of positive trading. This measure, which measures the price differential between Binance’s and Coinbase’s pairs of BTC/USDT, is often used as an indicator for US spot market demand.

This shift in the market comes after a longer run, 94 days of positive premiums. It is Bitcoin’s longest period with sustained institutional demand. The flip might indicate a waning interest from US investors, but broader signals show a nuanced market setup.

The onchain analyst Boris VestBitcoin’s buy-sell ratio for market makers has fallen to 0.9. This indicates that they are selling more. Bitcoin continues to trade above $115,000 despite the aggressive selling. This indicates that passive large buyers are taking over to relieve the pressure. 

While the rate of futures financing remains at 0,01, it does not show a bullish or a bearish dominant, which indicates that the leverage is equal and there will be a bigger move. 

Vest also pointed out that the CVD of futures continues to indicate persistent sell pressure while causing no major price breakdowns. The divergence in volume and price suggests that there is underlying strength. This may lead to a liquidation-driven move before we see any sustained upward movement.

Related: Bitcoin price gained 50% the last time its volatility fell this low

Bitcoin at a Crossroads Moment

Profit-taking appears to have also slowed down. Net realized profit/loss (NRPL) is a metric. shows There is no sign of mass exits and the adjusted SOPR stays well below the 1,10 threshold that’s usually associated with the tops of the market. These indicators indicate that investors have confidence in the current structure of the market, and they aren’t rushing to lock up profits.

The macro-economic conditions also support this opinion. This view is further supported by macro conditions. “Goldilocks” A risky backdrop is favorable. The consumer confidence has also rebounded following a 6-month drop, a reflection of a recovery in investor mood.

Bitcoin is in neutral territory, with the Federal Open Market Committee meeting (FOMC), the most likely event to determine the direction of the Bitcoin price. Titan of Crypto commented that the Bollinger Bands were tightening, which is a technical indicator used to measure volatility. These bands often compress when a significant breakout or breakdown nears. Analyst said, 

“Bitcoin in a pressure cooker. Bollinger Bands are squeezing = volatility is drying up. RSI is compressing too. A big move is brewing.”

Related: Bitcoin bulls aim to chase liquidity at $122K, but Q3 seasonality could stall breakouts

This article contains no investment recommendations or advice. Risk is inherent in every investment decision and trade. The reader should always do research prior to making a final decision.