Bitcoin oscillates around key resistance level

Recently, Bitcoin once rose to $61,400, close to its 50-day moving average. However, after hitting this resistance, Bitcoin quickly gave up all the gains, indicating that the $60,000 mark is still difficult to break. Such sideways fluctuations have occurred repeatedly in the past few months and have also led to large-scale liquidations in the futures market. In particular, the high cost price of short-term holders has become a major obstacle to Bitcoin's upward movement.

Long-term vs. short-term holders

Currently, about 74% of Bitcoin in the market has been held for at least six months, while more than 20% of Bitcoin is in the hands of short-term holders. The average cost price of these short-term holders is about $64,000, and most of them are currently at a loss. As short-term holders are eager to protect their capital, they will quickly sell Bitcoin once it approaches their cost price, which further suppresses the price of Bitcoin.

Miner Capitulation and Market Liquidity

A positive sign is that the "capitulation" of Bitcoin miners is nearing its end. The decline in Bitcoin hash rate in the past few months has signaled the plight of miners, but the trend has improved recently. In addition, the growth of global liquidity has also created favorable conditions for Bitcoin, especially as the US dollar weakens and the Federal Reserve may cut interest rates in September, which has provided support for Bitcoin.

The impact of global monetary policy

The rise in global M2 money supply, especially the gradual shift of central banks to loose monetary policy, indicates that Bitcoin will benefit again in the future. Although the global money supply is currently high, the continued depreciation of fiat currencies will further drive Bitcoin's rise in the long run. At the same time, the growth in demand in the stablecoin market also shows that the market's interest in cryptocurrencies is picking up.

Long-term holders’ increasing holdings

It is worth noting that long-term holders continue to increase their holdings of Bitcoin. For example, Japan's Meta Planet recently purchased another 57 Bitcoins, indicating their confidence in the future trend of Bitcoin. In addition, FTX creditors are expected to receive cash repayments in October, and this part of the funds is likely to flow back into the cryptocurrency market, bringing new momentum to Bitcoin.