- Fall in exchange-directed liquidity showed that seller pressure was limited
- Permanent BTC holder demand has been growing over the past two months
Bitcoin [BTC] has lost its upward momentum in the short term and formed another range in June. The attempted advance beyond $110.5k in June was halted at press time, but the $104.8k support zone has also been defended over the last few days.
Source: BTC/USDT on TradingView
The 12-hour chart revealed a bullish breaker block (white box) at $104.8k that has served as support. Based on the impulse rally from $100.3k to $110.5k, a set of Fibonacci retracement levels were plotted too.
The $104.2k and $102.5k levels were the ones to watch. Meanwhile, the monthly open and high for June at $104.6k and $110.2k were the short-term range levels mentioned. A drop below the bullish breaker block at $104.8k would mean that a reset towards $100k is possible.
While the short-term price action showed ranges and uncertain, fluctuating momentum, the long-term holders have maintained their bullish conviction. This phenomenon is known as “base-building,” where price action descends into range formations and consolidates as long-term investors add to their holdings.
Bitcoin in a consolidation phase before its next rally
In a post on X, crypto analyst Axel Adler Jr noted that there was strong evidence that base-building was indeed going on. For instance, the analyst observed the average daily inflows of USDT and USDC to centralized exchanges.
In December, these inflows hit a high of $131 billion. In June, the figure had dropped to a relatively meager $70 billion. This figure was $5 billion below the 365-day moving average.
The drop in stablecoin inflows reflected a cooling of excess bullish momentum. The range-bound price action above $100k signaled that holders may be willing to wait and limit their selling.
Finally, analytics platform CryptoQuant observed a steady increase in the 30-day moving average of accumulator addresses demand. These addresses consisted primarily of participants who accumulate BTC and “never engage in spending transactions,” according to analyst Julio Moreno.
The current scenario is a potent combination of permanent holder demand, reduced selling on exchanges, and a Bitcoin consolidation above the $100k psychological level. Together, they appear to give a strong signal that holders should prepare for much higher prices in the coming weeks.
