MARA - Bitcoin's $69K Resistance: The Key Level to Watch for a Potential Rally
2024-06-17 06:25:00 ET
InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Retaining its position as number 1 in the crypto rankings by market capitalization, Bitcoin ( BTC-USD ) has retained its dominance by most metrics.
Where stores of value are concerned in the digital asset sector, bitcoin is king. And while there have been some pullbacks from the token’s recent all-time high seen in March, Bitcoin has seen flutters of near-term momentum build.
Currently trading rangebound, investors are closely watching inflows and outflows from highly traded and recently approved spot Bitcoin ETFs.
The BlackRock iShares ETF is the most closely watched in this regard, with more than $20 billion in assets.
Analysts focusing on where Bitcoin may be headed from here do have some catalysts to watch. Here’s what to consider for those looking to potentially add Bitcoin in June.
Back at $69k
This month, Bitcoin rallied back to the $69,000 level after falling to $66,000 due to macroeconomic issues. For most of the month, the top crypto has traded in this range.
U.S. inflation data have shown decent progress, but inflation is remaining sticky. And while other G7 countries are cutting rates, it’s unclear whether the U.S. will follow suit anytime soon.
These sorts of macro factors will continue to play a big role in Bitcoin’s valuation. So long as the U.S. dollar remains high relative to other currencies, some downside pressure on Bitcoin may remain.
That said, as investors look for stores of value (such as gold, which has been on a tear), one could make the argument that Bitcoin is positioned for a nice rally in June and beyond.
Institutional capital inflows into this asset, as well as derivatives markets, will be important for investors to watch.
I think if Bitcoin is able to make a move above $69,000 again, this is a token that could really go on a run from here.
Whales Are Back At It
On June 11, Bitcoin whales accumulated 20,600 BTC worth $1.38 billion during a price slump. CryptoQuant reported this as the largest inflow since Feb. 28.
Daily inflows ranged from 1,300 to 2,200 BTC as prices dropped from $71,650 to about $69,000, culminating in the massive June 11 accumulation.
As of June 12, Bitcoin traded at $67,500 after a brief price spike. Exchange supply dropped to 942,000 BTC, the lowest since Dec. 22, 2021.
This reduction often signals a strengthening market with expected price increases. Bitcoin remains 8.45% below its March 13 all-time high of $73,737.
That said, concerns have arisen among some sophisticated investors about miners influencing BTC price trends. Marathon Digital’s (NASDAQ: MARA ) sale of 1,000 BTC worth nearly $70 million on June 10 heightened fears of a market downturn.
U.S.-listed spot Bitcoin ETFs experienced a net outflow of $65 million, with a total outflow of $200 million speculated as anticipation of economic uncertainties before Fed Chair Jerome Powell’s June 12 speech.
Bitcoin Remains a Strong Buy
Bitcoin continues to be the king of crypto portfolios for its popularity, leading Ethereum ( ETH-USD ) in terms of price performance by a significant margin.
If the long-term trends hold in place, and a post-halving rally is in order, this crypto could simply be consolidating before the next leg higher. At least, that’s the bull thesis right now.
Personally, I think Bitcoin will make a move higher, once it breaks through prior resistance levels around $69,000. Of course, such a bullish view isn’t without risk — we’ve seen what can happen during down markets. But right now, I think it’s the calm before the rally.
On the date of publication, Chris MacDonald did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Chris MacDonald’s love for investing led him to pursue an MBA in Finance and take on a number of management roles in corporate finance and venture capital over the past 15 years. His experience as a financial analyst in the past, coupled with his fervor for finding undervalued growth opportunities, contribute to his conservative, long-term investing perspective.
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