Bitcoin struggles at $66,000 amid Mt. Gox transfer concerns

Mt. Gox funds movement on Wednesday may negatively impact Bitcoin's price.
Bitcoin Magazine reports speculation that Kamala Harris might attend the upcoming July Bitcoin Conference with Donald Trump.
US spot Bitcoin ETFs registered slight outflows on Tuesday.

Bitcoin (BTC) price struggles around $66,000 on Wednesday. US spot Bitcoin ETFs experienced minor outflows on Tuesday, coinciding with the continued movement of Mt. Gox funds for repayment, which could exert downward pressure on Bitcoin's price.

Daily digest market movers: Bitcoin declines 2.36% on Tuesday as Mt. Gox starts repayment

Data from Lookonchain indicates that Mt. Gox moved 37,477 BTC, valued at $2.47 billion, on Wednesday. Since July 5, Mt.Gox has transferred 52,549 BTC worth $3.31 billion to Bitstamp, Kraken, and Bitbank for repayment. With Mt. Gox currently holding $5.95 billion in Bitcoin, this continued transfer of funds likely sparked FUD (Fear, Uncertainty, Doubt) among traders, potentially contributing to Bitcoin's price decline.

Mt. Gox moved 37,477 $BTC($2.47B) again 30 minutes ago!#MtGox has transferred 52,549 $BTC($3.31B) to #Bitstamp, #Kraken, and #Bitbank for repayment since July 5.https://t.co/f2q66eQfEM pic.twitter.com/vZVdCWHwG1
— Lookonchain (@lookonchain) July 24, 2024

On Tuesday, US spot Bitcoin ETFs experienced outflows totaling $77.80 million. During this period, Grayscale (GBTC), ARK 21Shares (ARKB), and Bitwise (BITB) decreased their holdings by 404.45 BTC, 774.82 BTC, and 1,040 BTC, respectively, while Blackrock (IBIT) added 1,070 BTC.
This decline suggests a slight weakening of investor confidence, potentially contributing to a temporary dip in Bitcoin's price on Tuesday. The net inflow data from ETFs is crucial for assessing investor sentiment and understanding market dynamics. Together, the 11 US spot Bitcoin ETFs currently hold reserves amounting to $53.16 billion in Bitcoin.

Bitcoin Spot ETF Net Inflow (USD) chart

According to Bitcoin Magazine, there is speculation that Democratic nominee Kamala Harris might share the stage with Donald Trump at the upcoming Bitcoin Conference, which is scheduled for July 25 to 27. If confirmed, her participation could set the stage for a significant showdown in the upcoming presidential race, especially amidst concerns among Democrats about Trump's growing appeal among crypto-investor voters.

JUST IN: #Bitcoin 2024 Conference CEO David Bailey is in talks with Kamala Harris campaign for her to speak at the event.

"They’re making up their minds today." pic.twitter.com/UjFWAAEpWy
— Bitcoin Magazine (@BitcoinMagazine) July 23, 2024

According to CryptoQuant, UTxO Realized Price Age Distribution is a set of realized prices and age bands. The metrics help investors to overview each cohort's holding behavior by overlaying a set of different realized prices. Realized price is calculated as Realized Cap divided by the total supply.
In BTC's recent movement, the price briefly dipped and stabilized at nearly $65,915. This range is close to the average purchase price of $66,500 for 1-3 month BTC holders, potentially serving as a support level.
However, further correction could see support around the $63,800 level, reflecting the average purchase price range of 3-6 month holders.

Bitcoin UTxO Realized Price Age Distribution chart

Technical analysis: BTC faces rejection around the $67,000 mark

Bitcoin’s price faced resistance around the weekly resistance level at 67,209 and declined by 2.3% on Tuesday. At the time of writing, BTC retraces and trades at around $65,632 on Wednesday.

If BTC continues to retrace, it could find support at the daily level of $64,913, coinciding closely with the 61.8% Fibonacci retracement level at $64,921, derived from the June 7 high of $71,997 to the July 5 low of $53,475. This would establish a critical zone of support that should be monitored closely.

If this area of support at $64,913 holds, BTC could rally 11% to retest its June 7 high of $71,997.

On the daily chart, the Relative Strength Index (RSI) and the Awesome Oscillator (AO) are trading above their neutral levels of 50 and zero, respectively. This robust momentum signals a strong bullish sentiment in the market.

BTC/USDT daily chart

However, a close below $62,736 and a break below the ascending trendline formed by joining multiple swing lows from July 5 would break the market structure from bullish to bearish by forming a lower low on the daily timeframe. Such a scenario might precipitate a 10% crash in Bitcoin's price to retest its July 12 low of $56,405.

Cryptocurrency metrics FAQs

What is circulating supply?

The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its inception, a total of 19,445,656 BTCs have been mined, which is the circulating supply of Bitcoin. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.

What is market capitalization?

Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value. For Bitcoin, the market capitalization at the beginning of August 2023 is above $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the Bitcoin price around $29,600.

What is trading volume?

Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.

What is funding rate?

Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.

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