Bitcoin Hits New June Lows, Open Interest Above $35B

Bitcoin (BTC) fell under $67,000 as markets braced themselves for an upcoming inflation report. The cryptocurrency marked new local lows at $66,696 on Bitstamp, making it the worst month-to-date performance. This drop occurred as Bitcoin experienced almost 24 hours of continuous decline, and risk assets were in a holding pattern ahead of significant U.S. macroeconomic data and Federal Reserve updates.

The BTC/USD pair saw a 3.6% decline on the day, with traders projecting potential further downside targets towards $60,000. One active trader, Roman, informed his followers on X (formerly Twitter) that he was waiting for a reversal near the $67,000 support to enter long positions. Roman has been monitoring this specific support level for over a week.

Another trader, Castillo Trading, agreed with the sentiment but set his sights on a slightly lower buy zone around $64,000. He noted that it was challenging to open new long positions when Bitcoin was hovering above $70,000. Now, as the price has dipped, he feels more comfortable considering new positions.

Throughout this period, others urged not to panic, underscoring the overall rangebound price action. Bitcoin has been consolidating below its all-time highs for nearly three months. A popular trader, Jelle, pointed out that the market was in the 15th week of trading below the current all-time highs. He reassured followers that despite the red start to the week and the push back into the key support level at $67,500, fundamental conditions haven’t changed.

Scott Melker, a trader, analyst, and podcast host, referred to the recent price movements as “much ado about nothing.” He observed that while there was a significant drop, it was merely a test of support at the range equilibrium and still within the upper half of its range. Melker mentioned that the market was experiencing the anticipated fluctuations for this stage of the cycle.

Market analysts also raised concerns regarding the open interest (OI) in derivatives markets. This metric hit all-time highs in June, crossing $37.6 billion, signaling potential BTC price volatility. Although Bitcoin futures OI decreased as the price fell, it remained above $35 billion, indicating lingering risk.

Filbfilb, co-founder of trading platform DecenTrader, highlighted the potentially precarious situation. He noted that while the price remained flat, OI had increased by $1.5 billion, labeling it a “high-risk situation.” Filbfilb also provided a “worst-case scenario,” suggesting possible downside movements to as low as $45,000.

The ongoing analysis and sentiment among traders and analysts indicate a mix of caution and strategic planning. While there are concerns about near-term volatility, many see opportunities for profitable trades should the market present favorable conditions. The cryptocurrency community remains vigilant, closely monitoring macroeconomic developments and their influence on Bitcoin’s price trajectory.