Bitcoin bears have been consistently selling off during any market rallies in recent months, but analysts are optimistic that a surge in liquidity, fueled by Bitcoin’s latest record-breaking highs, could help break this trend.
A pseudonymous crypto trader known as Daan Crypto Trades shared their insights on the X social media network on June 13, emphasizing the urgent need for a significant boost in liquidity. This call for increased liquidity comes as Bitcoin experiences volatile price swings, with its value fluctuating between $66,500 and $72,000.
According to Daan Crypto Trades, the market has been plagued by continuous selling pressure during recent months, with traders capitalizing on every price increase. The trader believes that the most effective way to disrupt this cycle is for Bitcoin to achieve a new all-time high.
Current data from Cointelegraph Markets Pro and Binance indicates that Bitcoin is currently trading at $67,474, approximately 10% below its peak of $73,808 in March.
Daan Crypto Trades expressed confidence that Bitcoin’s price could surge rapidly without the need for external catalysts, as long as there is sufficient liquidity in the market to support increased buying activity. This liquidity boost may soon materialize, as Microstrategy, a major holder of Bitcoin, announced plans to raise $500 million to acquire more Bitcoin, among other corporate objectives.
The trader highlighted the positive impact of this move on market liquidity, stating that it could provide a significant boost for Bitcoin. Additionally, increased inflows into spot Bitcoin ETFs could further contribute to the liquidity needed to drive Bitcoin out of its current consolidation phase.
Despite these developments, Bitcoin’s price remains range-bound, as noted by analyst Rekt Capital. The analyst suggested that Bitcoin may remain within its current accumulation range until September 2024, based on historical patterns.
While the market continues to experience stagnation, it is evident that high demand-side liquidity is essential for Bitcoin to break through key resistance levels and enter a phase of price discovery. This ongoing stalemate between buyers and sellers underscores the importance of monitoring market dynamics closely and conducting thorough research before making any investment decisions.