In early June, just when it looked like the Bitcoin (BTC-USD) sell-off would end, the breakdown returned on June 25.
BTC rallied from the $60,000 support zone to over $66,000 by June 15. Unfortunately, sellers stepped in nearly daily. Last week, the cryptocurrency tested the $59,200 - $59,999 support zones. When might the selling pressures end?
What Happened
The U.S. bombing of Iran sent WTI crude oil prices well above $100 per barrel. That hurt the U.S. dollar (UUP), boosted gold and silver, and lifted oil stocks. After each weekly to bi-weekly announcements of peace on the way, oil, gold, and silver prices fell. The U.S. dollar broke out to a one-year high.
Oil inflation dramatically lowered the odds of the Federal Reserve cutting interest rates this year. Instead, markets started to price in a 25 bps rate hike as the Fed’s next move. This increased demand for U.S. debt. The TLT and IEF ETFs both rallied. Money flowed into U.S. currency and debt.
On the week of June 23, investors sold Bitcoin ETFs at a net outflow of $113.78 million. BlackRock’s (BLK) Bitcoin Trust (IBIT) faced withdrawals worth $182 million. Coinbase (COIN) sold 11,670 Bitcoin, too.
Strategy (MSTR), which leveraged its balance sheet to hold Bitcoin, lost ~ 30% of its stock value last week.
Watch for Bitcoin to hold the $60,000 zone. The longer it stays there, the more likely the price breakdown ends.
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