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07.06.2023 12:40 PM
Institutions show interest in Bitcoin amid correction

The swings in the cryptocurrency market continue due to a combination of technical and fundamental factors. Bitcoin trading volumes remain at $15 billion, while the asset's price fluctuates depending on the rapidly changing macroeconomic situation. Yesterday, BTC managed to recover above $27k, but it seems that the situation will change again.

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The macroeconomic background is becoming the main catalyst for investor actions. Recent news indicates that high-risk assets remain unpopular among investors, but the situation may change soon due to stock market issues.

Macroeconomic factors

Negative forecasts made by leading global banks in the spring did not materialize. As a result, S&P 500 companies showed positive earnings reports and gave a second wave to the upward movement of the stock market. However, according to analysts at Morgan Stanley, a shock decline in S&P 500 company profits is expected in June–July.

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At the same time, most investors expect a pause in the increase of the key interest rate in June. The Federal Reserve's meeting and inflation data are expected next week. If hopes for a pause are justified, another phase of a local upward movement in the stock market should be expected.

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However, JPMorgan analysts note that investors' attitude towards high-risk assets remains cautious. While stock market instruments show positive results, the cryptocurrency market is in a correction phase. Regulatory pressure on the industry is influencing the decline in investment appetite for digital assets.

SEC doesn't stop

After filing a lawsuit against the largest cryptocurrency exchange and declaring major cryptocurrencies as securities, the SEC is now targeting the second-largest U.S. exchange. Against this backdrop, there is a massive outflow of funds from centralized crypto platforms. Binance lost over $1.5 billion in just one day.

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Large investors take advantage of this situation and actively accumulate liquidity that panic-stricken small investors leave behind. Glassnode reports a surge in BTC sales at a loss by short-term holders. Meanwhile, Franklin Templeton confirms that "whales" are actively accumulating volumes amid the panic of their smaller counterparts.

BTC/USD Analysis

While "whales" and large investors take advantage of the FUD surrounding major cryptocurrency exchanges and accumulate BTC reserves, the asset is recovering above $26.5k. At the end of the previous trading day, the cryptocurrency formed a "bullish engulfing" pattern and reached the $27k level. Subsequently, the bears managed to push the price below $27k.

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A positive signal is that the upward price movement occurred on increasing volumes. This indicates that, despite the active influence of market makers, other categories of investors also participated in the price increase. Despite all efforts, the bulls' main target remains the $27k level. Breaking through it will allow BTC to continue its movement towards the upper boundary of the range at $27.5k.

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From a technical standpoint, the daily chart shows an activation of sellers and increasing pressure on the price. The Stochastic indicator is implementing a bearish crossover, while the RSI continues to decline. At the same time, the MACD is forming a bullish crossover, which is a signal of a potential formation of an upward trend.

Conclusion

The BTC market continues to experience swings, with the SEC and panic among crypto investors being the main sponsors. Against this backdrop, large players are increasing their holdings and injecting liquidity to sustain the structure of the upward trend. The bulls' main target remains the $27k–$27.5k range, while the bears focus on breaking the $26k level.

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