Why is the Bitcoin price rising today? Detailed explanation of BTC price trend on July 6

Why is Bitcoin price rising today? Strong Bitcoin exchange-traded fund (ETF) inflows, coupled with increased bets on a September rate cut, have driven Bitcoin (BTC) prices higher today. Today, the editor of this website will give you a detailed introduction to the reasons for the skyrocketing price of Bitcoin. Friends who need it can take a look!

Bitcoin price rebounded today

After falling to $51,000 today, Bitcoin price rebounded 6.40% on July 6 to reach $58,236. The day before, Bitcoin prices hit a five-month low. The rally suggests traders are starting to get over the negative impact of Mt.

Bitcoin Analysts Try to Calm Panic Sellers

Over the past 24 hours, top cryptocurrency analysts and opinion leaders have been working to downplay the impact of Mt. Influence.

Among them is Ki Young Ju, founder and CEO of cryptocurrency quantitative analysis platform CryptoQuant, who reminded traders that government-controlled Bitcoin is worth $8 billion, which only accounts for the total $225 billion flowing into the Bitcoin market since 2023 4%.

In other words, the Bitcoin market has enough liquidity to absorb the impact of a government-led Bitcoin sell-off, especially amid concerns that the German government may dump its remaining ~42,000 in the coming days. Bitcoin (as of July 6).

Similarly, independent market analyst Trader Tardigrade compared the current Bitcoin market sell-off to past black swan events, which have resulted in sharp price rallies and subsequent long-term bull cycles.

He pointed out: “In 2016, 2020 and 2024, the trend of Bitcoin has shown the same pattern. Except in 2020, Bitcoin has dived after falling below the trend line. After regaining the trend line, A bull market usually follows.” Analyst Rekt Capital believes that the current Bitcoin market sell-off is part of a typical cycle after the Bitcoin halving event. In this post-halving trend, Bitcoin’s price tends to experience significant declines for several months as the market adjusts to new supply dynamics.

However, as reduced supply begins to impact the market, prices eventually recover and often enter a strong upward trend due to reduced supply and increased demand.

Bitcoin traders keep pace with the stock market

Bitcoin’s strong rally today was boosted by U.S. stocks hitting all-time highs.

In a post-holiday trading day with light trading volume, the S&P 500 reached its 34th all-time high of the year. Stocks rebounded after a period of volatility after data showed U.S. hiring slowed and the unemployment rate rose to its highest level since 2021.

With disappointing employment data, Wall Street now puts a 72% chance of a rate cut in September, up from 55.4% a month ago. Rate cuts are generally positive for Bitcoin and other riskier assets because they reduce the opportunity cost of holding lower-yielding U.S. Treasuries.

For example, when US employment data was released on July 5, Bitcoin exchange-traded funds (ETFs) attracted $143.1 million in inflows. Earlier this week, these ETFs experienced outflows for two consecutive days.

Bitcoin Futures Funding Rates Surge

The rebound in Bitcoin prices has been accompanied by a strong increase in funding rates in the futures market, although open interest (OI) has fallen significantly over the same period.

As of July 6, the funding rate for Bitcoin futures was a net positive weekly of 0.178%, up from a weekly net positive of 0.044% two days ago. At the same time, open interest (OI), as reflected in total open interest, fell to approximately $28 billion from $31.64 billion during the same period.

In short, traders are confident about rising prices and are willing to pay higher rates to maintain their long positions.

Bitcoin’s open interest is decreasing while funding rates are increasing, further signaling a phase where weaker hands are exiting their positions while more confident traders or institutions are maintaining or increasing their exposures , prices are expected to rise.

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