Crypto Market Still in Bull Cycle But There Are Worrying Signs: CryptoQuant

The cryptocurrency market is in the red amid massive bloodshed in Bitcoin (BTC) and altcoins. There is currently no upside momentum, and Bitcoin is hovering around key levels, falling below the achieved price for on-chain traders of $65,800.

Regardless, CryptoQuant analysts have recently insisted a report That the market is in bull season.

Lack of upward momentum

The lack of upward momentum in the cryptocurrency market is evidenced by weak demand growth for Bitcoin and low liquidity of the stablecoin. Demand from large Bitcoin holders is not strong and is growing at a monthly rate of 4.8%. Although the current rate is slightly higher than the 2.4% seen in late May, it is still a far cry from the 6%-10% recorded in the first quarter of this year, when Bitcoin rose to an all-time high.

In addition, traders’ demand for Bitcoin has not yet renewed, as shown in on-chain data, indicating that they are not buying the asset at the moment. This group of investors has been reducing their holdings since Bitcoin hit $70,000 in late May.

Stablecoin liquidity, linked to rising prices, has continued to decline, marking the slowest pace since November 2023. Tether’s (USDT) 60-day market capitalization growth has slowed from $12.6 billion in late April to $3.7 billion currently. The cryptocurrency market needs higher liquidity for stablecoins for prices to rise.

BTC could reach $60,000

Furthermore, demand for Bitcoin and Ether (ETH) from US investors remains at its weakest, as evidenced by BTC and Ethereum Coinbase premiums remaining below zero since May 20. The growth in US investor demand is an important driver for BTC and ETH. the prices.

Weak demand from US investors can also be seen in Bitcoin exchange-traded funds, which have been in a state of continuous outflow since June 13. The funds collectively lost more than $100 million each trading day last week.

“In fact, CryptoQuant’s Bull and Bear Market Cycle Indicator is still trending lower, indicating that we are still in a bull market but without significant upward momentum. The indicator is at its lowest level since October 2023 and below the 30-period moving average CryptoQuant stated that a crossover of the 30-day moving average is needed for the indicator to indicate upward momentum.

Meanwhile, Bitcoin can drop Plus $60,000, which is lower than the price achieved by on-chain traders.