Bitcoin Price Forecast: BTC dips below $67,000 as holders book profits
Bitcoin price today: $67,000
- Bitcoin price dips for a second consecutive day as holders book some profits.
- US Spot ETF experienced inflows of $297.60 million on Monday.
- Crypto market price action may be choppy this week due to a lack of immediate catalysts.
Bitcoin (BTC) continues to trade in the red on Tuesday after facing rejection around the $70,000 level on Monday. Despite the price decline, institutional investors capitalized on the recent dips, with the US spot Exchange Traded Funds (ETFs) recording over $297 million in inflows. Looking ahead, crypto market price action may be choppy this week due to a lack of immediate catalysts.
Bitcoin institutional investors bought recent dips
On Monday, institutional investors capitalized on Bitcoin price dips. Coinglass ETF data shows that the US spot ETFs experienced a net inflow of $297.60 million, largely fueled by BlackRock (IBIT) funds, contributing $332.30 million. This marks seven consecutive days of inflows, and if this trend continues or intensifies, it could further bolster Bitcoin’s recent price rally.
Total Bitcoin Spot ETF Net Inflow chart. Source: Coinglass
Santiment’s Network Realized Profit/Loss (NPL) indicator gives an idea about what could be behind the recent price dips. This indicator computes a daily network-level Return On Investment (ROI) based on the coin’s on-chain transaction volume. Strong spikes in a coin’s NPL indicate that its holders are, on average, selling their bags at a significant profit. On the other hand, strong dips imply that the coin’s holders are, on average, realizing losses, suggesting panic sell-offs and investor capitulation.
In BTC’s case, the NPL indicator spiked from 348.87 million to 1.64 billion from Saturday to Sunday. This uptick indicates that the holders were, on average, taking profits.
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Bitcoin Network Realized Profit/Loss chart. Source: Santiment
QCP Capital’s report on Monday highlights that crypto market price action may be choppy this week due to a lack of immediate catalysts. However, it also notes an optimistic sentiment driven by the upcoming US elections, to be held in 15 days, and strong equity performance, as evidenced by Risk Reversals shifting in favor of Calls across all tenors.
Bitcoin Price Forecast: Not strong enough to overcome $70,000
Bitcoin price faces resistance around the psychologically significant $70,000 level, declining 2.4% on Monday. At the time of writing on Tuesday, it continues to trade slightly lower at approximately $67,100.
If BTC continues its retracement, it could decline further to retest its next psychological support level, $66,000.
The Relative Strength Index (RSI) on the daily chart trades at 60 and points downwards after rejection from an overbought level of 70, indicating weakness in bullish momentum. If it continues to decline and closes below its neutral level of 50, it could lead to a sharp decline in Bitcoin price.
BTC/USDT daily chart
If BTC breaks and closes above $70,079, it could rally to its next key barrier, which is already the all-time high of $73,777 seen in mid-March.
Bitcoin, altcoins, stablecoins FAQs
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.
Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.
Bitcoin dominance is the ratio of Bitcoin's market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.
Author
Manish Chhetri
FXStreet
Manish Chhetri is a crypto specialist with over four years of experience in the cryptocurrency industry.
