Bitcoin has crossed above $104,000, reaching a new all-time high in its current cycle. What was remarkable about this rally is that it has boomed under these three main, positive forces. Diminished miner selling pressure, strong ETF inflows, a revived “anti-fiat currency” narrative on changing global macroeconomic conditions—these are among big factors at work. The leverage build up of Bitcoin derivatives is increasing. Moreover, uncertainties regarding the effects and the implementation of the China-US trade agreement could pose risks to short-term volatility.
Bitcoin's Bullish Momentum
Bitcoin’s price today is $104,250. In the last day, it’s down 1%, but in the last 30 days, it’s been up 30%. This current climbing path emphasizes the positive bullish sentiment that is dominating the market right now.
More than 80% of Bitcoin are held by long-term holders, or those who have held their investment for at least six months. This is indicative of their strong conviction and belief development in Bitcoin’s long-term value. This compares with the extreme ‘panic selling’ seen back in early 2024, demonstrating a dramatic change in tone and sentiment across the markets rather than just the crypto space.
Miners' Strategic Shift
Miners’ selling pressure has hit a cycle-low negative level, indicating that miners might have only started to sell at their peak of liquidation. They’re going beyond simply raising extra cash by selling Bitcoin to fund their operations. Now, they are smartly stockpiling it, anticipating much greater dividends down the road.
That change is powerfully confirmed by another remarkable reality. Average daily absorption of Bitcoin ETF $$$ is at least 800 coins per day vs the miners’ 450 coin/day keep rate. The unprecedented demand for Bitcoin ETFs globally is continuing to alleviate the selling pressure coming from miners. The market is able to absorb their output now without resulting in massive price decreases. Thirdly, if Bitcoin crosses above the $110,000 threshold, miners will be incentivized to liquidate even more. They’ll want to cash in on those greater prices.
In the past, high levels of leverage and long-term accumulation by miners have pushed these entities into liquidity crises. Whether or not this deepening institutionalization of Bitcoin can counterbalance these risks in this cycle remains to be seen.
Potential Risks and Future Outlook
There’s a lot of derivative Bitcoin leverage that has accumulated around the $100,000-$110,000 price range which could get unwound with big price movements. A large number of highly leveraged long positions could be vulnerable to liquidation if the price experiences a significant correction.
Moreover, the unknowns surrounding the China-US trade deal add a layer of uncertainty into the market. If the handshake reduces the US dollar index, we will likely see an increase in Bitcoin’s price. This would further play into the narrative of Bitcoin being an “anti-fiat currency.” On the other hand, if the trade deal is favorable for broader technology stocks, Bitcoin may reap residual benefits.
Looking forward, this $100,000 level will be an important anchor support. A decisive break below that level would likely be a sign that sentiment has turned against the market. On the other hand, consolidation above it would strengthen the bullish outlook.
