Following many retail trader selloffs in June, the crypto market shows an optimistic outlook for July. Santiment data reveals that the crypto market appears poised for a relief rally after a downward trend in June.
Bitcoin shed 7% of its gains in June, declining to a price bottom of $59,500. Most altcoins mirrored Bitcoin’s bearish outlook, recording significant price declines.
The total crypto market cap also declined by $400 billion due to the bearish conditions in June. However, with investor sentiment turning positive in July, asset prices have started entering a recovery phase.
Crypto Market Enters Recovery Phase as Selling Pressure Fades
CryptoQuant author Minkyu Woo is quite optimistic about the crypto market outlook. In a July 1 blog post, he revealed that the sellers are finally exhausted, hinting at a price turnaround.
Woo also noted that the average size of top Tether (USDT) outflows from exchanges since January 2023 has decreased. He believes that large-scale selling pressure on crypto exchanges is declining.
Given the positive market outlook, investors will likely hold their assets rather than withdraw cash from the market. However, these predictions are purely speculative due to the volatile nature of the crypto market and external factors like inflation.
Factors Likely to Influence The Market in July
While a wave of positivity has swept across the crypto market, there are bearish events that could force a reversal. The Mt Gox payments scheduled to begin in July could put massive selling pressure on Bitcoin, forcing a price decline.
A decline in Bitcoin’s price could depress the broader market outlook since most altcoins correlate to its price. According to analyst Degen Kid, Mt.Gox is about to dump $9 billion in Bitcoin (BTC) and Bitcoin Cash (BCH) on the market.
While such a massive selling pressure could push Bitcoin below $60,000 to around $55,000, the analyst says it’s a great buying opportunity for late buyers and a re-entry point for sellers.
Analysts Forecast Crypto Market Outlook
Bloomberg’s senior ETF analyst, Eric Balchunas, believes the upcoming Mt.Gox repayement will neutralize the effect of the ETF inflows. While Balchunas isn’t sure all the recipients will sell their Bitcoin, he believes some will likely cash in on their tokens.
That’s like over half of all the ETF inflows being negated in one shot. Damn. https://t.co/rBrFb6xpX1
— Eric Balchunas (@EricBalchunas) June 24, 2024
Despite the depressing outlook, analyst Rekt Capital remains bullish on Bitcoin’s chances. He said the rate of acceleration in this Bitcoin cycle was 260 days in mid-March. The acceleration rate dropped to approximately 150 days after halving.
Given this observation, the analyst believes Bitcoin is aligning with its historical halving cycle, leading to a longer bull run.
Another popular crypto analyst, Willy Woo, foresees Bitcoin’s price staying in a downtrend for four weeks before recovering. Woo believes BTC will eventually recover, giving the crypto market a facelift.
Meanwhile, Spotonchain revealed the Spot BTC ETFs saw net inflows of $129 million on July 1, with zero outflows. Moreover, the ETFs have recorded positive net inflows for five consecutive trading days. This data confirms renewed interest from investors in the products and could trigger gains for Bitcoin.
🚨 $BTC #ETF Net Inflow July 1, 2024: +$129M!
• No US Bitcoin ETF saw an outflow yesterday 🎉.
• #Fidelity (FBTC) saw the largest single-day inflow at $65M.
• Both #BlackRock (IBIT) and #Grayscale (GBTC) experienced net flows of $0 yesterday.
• Overall, the net inflow… pic.twitter.com/rM9socAJ5t
— Spot On Chain (@spotonchain) July 2, 2024
Overall, positive investor sentiments and favorable economic factors could aid the prices of crypto assets in July.
Disclaimer: The opinions expressed in this article do not constitute financial advice. We encourage readers to conduct their own research and determine their own risk tolerance before making any financial decisions. Cryptocurrency is a highly volatile, high-risk asset class.
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