Bitcoin deals with $70,000 if it breaks the consolidation area

• QCP Capital’s report highlights how recent global macroeconomic developments are supporting Bitcoin’s growth.
• Ki Young Ju, founder of CryptoQuant, posts on X about the growing dominance of the US in BTC holdings and the return of spot demand for ETFs.
• Arkham intelligence data shows some concern about the rise of Bitcoin as MT. Gox wallet is on the move.

Bitcoin (BTC) is trading slightly higher around $64,000 on Thursday after a rejection from the previous day’s $64,700 consolidation high. BTC price has been consolidating between $62,000 and $64,700 over the past week. QCP Capital’s report highlights macroeconomic developments that could support risk assets like Bitcoin. At the same time, Ki Young Ju, founder of CryptoQuant, sees an increase in US dominance in BTC holdings and a rebound in spot demand for ETFs, suggesting a potential rally in the coming days.

Bitcoin optimism is growing amid favorable global macroeconomic developments

QCP Capital’s Wednesday report highlights a number of macroeconomic developments that could be more bullish for risk assets, including crypto.

According to the report, “The People’s Bank of China (PBoC) has introduced several policies aimed at kick-starting its booming housing market and anemic stock market. It appears to have worked (for now) as Chinese A50 futures closed 8% higher, with the Chinese and Hong Kong indices following suit.”

The report continued: “The PBoC also announced an unprecedented RMB 500 billion swap facility that allows non-bank financial institutions to buy Chinese equities. This facility was previously only available to national banks.”

QCP analysts expect further easing from the PBoC following the recent interest rate cut by the US Federal Reserve (Fed); all major central banks (except the Bank of Japan) are ready to inject more liquidity into the market.

The report also highlights the widening yield spread between the 2-year and 10-year US Treasuries over the past month, which rose 40 bps and are now trading at 21 bps. A widening spread generally suggests optimism about economic growth, which supports risk assets over the medium to long term.

Additionally, on the US political front, Kamala Harris spoke positively about AI and digital assets at the fundraiser. Following her speech, rallies were seen in AI-related coins. The SEC approving options trading on IBIT (BlackRock’s Spot BTC ETF) also shows growing acceptance and demand for digital assets as an asset class.

Ki Young Ju, founder and CEO of CryptoQuant, an on-chain data and analytics company, posted on X on Wednesday that “the US is regaining dominance in Bitcoin holdings. Its ratio compared to other countries is increasing, driven by demand for spot ETFs.”

He too POSTED“Demand for Bitcoin spot ETFs has rebounded, with the 30-day net change in total holdings turning positive.” These are positive signs for Bitcoin as they indicate growing investor confidence and increasing institutional demand.

Bitcoin Spot ETF Holding 30-Day Change Chart

However, Arkham’s intelligence data shows some concern about the rise of Bitcoin. The data shows that the defunct crypto exchange MT. Gox wallet is on the move.

On Wednesday, they emptied four of their wallets after receiving $370,000 in BTC funds from the Kraken exchange. This move could be repayments to creditors coming soon. If refunds are made to lenders, fear, uncertainty and doubt (FUD) could be triggered among traders as these lenders are more likely to transfer their BTC to centralized exchanges to sell. Investors should be cautious about such activity. Wallet Mt. Gox currently holds 44,899 BTC worth $2.85 billion.

Technical Analysis: BTC extends consolidation between $62,000 and $64,700

Bitcoin price has been consolidating between the key levels of $62,000 and $64,700 for over a week after rising 7.5% last week. On Wednesday, it was rejected from the $64,700 level for the third time. As of Thursday, it is trading slightly higher around $64,000.

If Bitcoin price breaks this consolidation range around $64,700, it could first rise to retest the daily resistance level at $65,379. A daily close above this level could extend the rally by 7% to retest the July 29 high of $70,079.

The Relative Strength Index (RSI) on the daily chart has dipped slightly since Tuesday, but is currently looking up, trading at 61. For Bitcoin to break out of the consolidation zone, the RSI must rise and move towards its of 70. However, traders should be cautious if it crosses the overbought level of 70.

BTC/USDT Daily Chart

On the other hand, if BTC breaks and closes below the consolidation zone around $62,000, it could drop 7% to retest the September 17 low of $57,610.