According to Foresight News, the price of Bitcoin fell below the 120-day range to $53,219 on July 3rd due to market concerns about the German government and Mt.Gox creditors selling off. However, weekend market data suggests that a potential local bottom may have been reached. The market has realized that although the Bitcoin transferred by the German government has a high nominal value, it accounts for a small proportion of the total trading volume. Volatility indicators suggest that the market expects more stability in the future, with Bitcoin possibly hovering at current levels or experiencing a reduced decline.
Market positioning shows complacency among short sellers, with more investors going short later in the short term, and both sides may lack clear conviction. Long-term Bitcoin holders continue to realize significant profits, while short-term holders may be nearing exhaustion in their sell-off. The Bitcoin perpetual contract funding rate has turned negative for the first time since May 1st, possibly indicating an oversold market. Combined with the recovering SOPR, this usually means the market is finding a bottom.
On the macroeconomic front, Federal Reserve officials are cautious about cutting interest rates, despite labor market data and easing inflation supporting looser monetary conditions. Wage growth is slowing, job creation is less than expected, and unemployment duration is extending. Both the manufacturing and non-manufacturing purchasing managers' indices have fallen, reflecting weakened demand and sentiment, and employment in both manufacturing and service industries has declined. The agency does not expect the Federal Reserve to cut interest rates at the policy meeting on July 30th to 31st, but still holds hope for a rate cut in September.