Bitcoin’s price started the week at $62,000, showing a 4% increase over the weekend. However, key on-chain BTC metrics indicate that the market could experience significant volatility in the coming week.
The recent slowdown in Bitcoin ETF inflows, combined with miners selling off their reserves due to the halving, has raised the risk of intense market volatility for BTC.
Over the past 10 days, Bitcoin miners have offloaded 100,000 BTC, causing the price to remain within a narrow range of $59,000 to $63,000. The outflows from Grayscale’s GBTC ETF, totaling over $200 million, and declining inflows into newly approved spot BTC funds have put downward pressure on Bitcoin’s price after a strong start to 2024.
Bull traders have vigorously defended the critical support level at $58,000 in the past week. However, recent trends among Bitcoin miners suggest that additional pressure could be imminent.
The chart from IntoTheBlock reveals that recognized Bitcoin miners and mining pools have reduced their balances from 1.93 million BTC to 1.92 million BTC since May 3, 2024. This amounts to over $623 million in BTC sold within the last 10 days, considering the current price of around $62,300 per coin.
The miners’ selling frenzy is likely due to the halving event, which reduced their revenue per block from 6.25 BTC to 3.13 BTC. With many miners becoming unprofitable, they have resorted to selling their reserves to cover operating costs, given the flat outflows from Grayscale’s GBTC ETF. If Bitcoin prices do not increase significantly, miners may continue to sell off more coins, posing a risk of another reversal below $60,000.
Furthermore, the miners’ sell-off could discourage strategic swing traders from making fresh capital inflows to avoid the inflationary impact of the newly issued BTC flooding the markets.
The forecast for Bitcoin’s price suggests a possible reversal towards $58,000 as miners react to the halving’s impact on their bottom line. However, IntoTheBlock’s data indicates that there is strong short-term support at the $59,600 level.
Market analysts anticipate imminent rate cuts by the Federal Reserve following underwhelming jobs data in April. This could lead Bitcoin investors who bought in at the $59,600 level to cover their positions rather than exit early. If the crucial support level fails to hold, the BTC price could decline to as low as $58,000.
On the upside, a mild rally towards $65,000 may occur if Bitcoin ETFs see rapid inflows this week. However, if the miner’s sell-off continues, the BTC price is likely to consolidate below the $64,000 level.
It is important to note that this article is for informational purposes only and should not be considered financial advice. The views expressed in this article are the author’s personal opinions and do not reflect the opinion of The Crypto Basic. Readers are advised to conduct thorough research before making any investment decisions, and The Crypto Basic assumes no responsibility for any financial losses.
