Bitcoin holds $63K support as spot demand deteriorates
Bitcoin is maintaining a crucial technical support level, but a collapse in underlying spot demand and rising geopolitical risks leave the market structurally fragile.
Bitcoin starts the final full week of July holding its 200-week simple moving average at $63,322 for a third consecutive week, giving traders a short-term price target of $67,000.
The technical hold has shifted short-term sentiment, with the Crypto Fear & Greed Index hitting 29 on Monday, its highest level since early June. “Wouldn’t surprise me if we see some further relief this week - towards 65-67k,” trader Jelle noted.
Fellow trader Daan Crypto Trades observed that a strong push is needed to retrace recent losses. “Until then, we’re just caught in this $60K choppy price range,” he wrote.
Research platform Santiment linked the sentiment rebound directly to the return of exchange-traded fund inflows. “After a long outflow stretch throughout May and June, this shift signals ETF demand is back and confidence in crypto is starting to pick up again,” it stated.
Despite positive ETF flows over four of the last five days, broader spot demand is collapsing. CryptoQuant reported that 30-day spot demand deteriorated from negative 80,000 BTC in early July to nearly negative 170,000 BTC.
“Derivatives demand remains insufficient to support a sustainable uptrend on its own. This leaves the market in a structurally fragile state, where renewed spot selling could trigger a sharp downside move,” CryptoQuant contributor ScenarioX warned.
The firm added that a continued rally without meaningful spot demand is likely to end in a significant long liquidation event. Meanwhile, the Puell Multiple indicates easing miner pressure rather than a generational bottom. “Today reads as easing miner pressure, not a generational low,” CryptoQuant contributor TheChessOnChain explained.
These internal frailties are exposed as external macro risks escalate. US-Iran tensions have closed the Strait of Hormuz, pushing WTI crude above $80 and Brent above $90. CME Group data shows market consensus currently expects a 0.25% interest rate hike in September.
Major tech earnings from Tesla, Alphabet, and Intel this week will provide further volatility catalysts across risk assets. For longer-term investors, analyst Rekt Capital calculates the current bear market is just over 70% complete, with a cycle bottom not expected until 2027.
