After a sluggish and dismal June, Bitcoin surged 4% on the first day of July, reaching over $63,000.
Some analysts said that Bitcoin had a lackluster performance in June, falling nearly 7% that month, and could see a strong rebound in July.
Bitcoin prices fell 6.96% last month, compared with a historical average drop of 0.35% in June, according to Coinglass, which tracks bitcoin’s monthly returns since 2013.
Ali Martinez, a cryptocurrency market analyst, pointed out in a June 30 X post that in previous years, whenever June ended with a downtrend, there was a strong rebound the following month, with Bitcoin’s historical average July gain being 7.42%.
Overall, BTC’s monthly gains have been as low as 8% during the July trading period over the past 11 years.
Historically, whenever June ends in the red, Bitcoin has performed strongly in July.
Memecoin analyst Murad pointed this out, noting that July started with a rapid historical rally.
Murad noted that for the past six consecutive years, Bitcoin has recorded at least 28% gains in the first few weeks of July each year.
However, some analysts predict that July could be tougher than usual, noting that large sales of bitcoin by the German government and upcoming Mt. Gox repayments could weigh on bitcoin prices.
According to previous reports, the Bitcoin address marked as "German Government" underwent multiple transfers at the end of June, and more than 3,500 BTC (more than US$225 million) were transferred to CEX. The address currently holds nearly US$3 billion in Bitcoin.
Mt. Gox adds new pressure on Bitcoin
It is expected that these Mt. Gox bankruptcy compensation will be continuously repaid to creditors starting from the first week of this month, with the scale of compensation reaching approximately US$8.5 billion in BTC.
However, some analysts believe that the impact of these compensation payments may not be as severe as many investors expect, with only $4 billion of them entering the spot BTC market.
On the other hand, historically, Bitcoin’s best monthly performance tends to occur in November, with an average monthly gain of 46.81% since 2013.
How will the market develop next?
Crypto investment institution QCP Capital said in a statement today that BTC rebounded from the $60,000 area to $63,700 just after entering the second half of the year, and briefly fell below the $60,000 support level last week. The BTC spot ETF had a net inflow of $73 million last Friday, the highest single-day inflow in two weeks. According to seasonal data, BTC's median return in July was 9.6%, especially after a negative return in June (-9.85%). QCP Capital's options trading department also observed capital flows last Friday in preparation for a month-end rally, possibly in anticipation of the launch of the ETH spot ETF. All signs point to July being a bullish month.
After ending 7 consecutive net inflows, Bitcoin spot ETFs have seen net inflows for 4 consecutive days, which may be a sign of an improvement in the market. Bitcoin's downturn in late June may be related to the continuous outflow of Bitcoin spot ETFs, a trend that was not reversed until the last few days of June. Currently, the net value of Bitcoin spot ETFs exceeds US$52 billion.
However, it will not be easy for Bitcoin to continue to rise, and it may face new resistance. Analysts at Blockware Intelligence said: "For the first time since August 2023, the price of Bitcoin fell below the total cost basis of short-term holders. In the short term, we should expect some resistance at around $65,000 as short-term market speculators may seek to exit their positions at the 'breakeven' level."
The analyst added: “Last summer, when BTC lost STH RP [real price] support, the price moved sideways for two months before finally breaking out again.”
Regarding the volatility within this cycle, Blockware said: "During the 2017 cycle, BTC fell 10 times, with a drop of 20% or more. This is a normal and healthy bull market adjustment. Bitcoin's price volatility will deter weak investors and provide opportunities for strategic capital deployment for those with a longer time frame."
