General market sentiment has turned on its head as Bitcoin enters the mid-$ 34,000 range. It has bounced back from the lows and is currently trading at $ 34,228.

Source: Tradingview

In the coming days, it looks like Bitcoin price could continue to rise if it breaks above it and holds the monthly opening at $ 35,000. Pumping over the weekend was an important step towards that goal.

However, the trader NebraskanGooner advises caution as Bitcoin has been rejected at the current level and has often fallen down afterwards.

“The current market conditions have proven that we cannot get upset about resistance. I can’t help but think that people are still blindly buying and still having other excruciating pain. “

Alex Mashinsky, founder of C Network, too share a similar argument. He believes Bitcoin saw two surrender sales in May and June, the first being driven by retail investors who bought FOMO when Bitcoin price was at an all-time high (ATH) of $ 65,000.

These investors reduced their losses when Bitcoin fell to $ 40,000 and continued to do so when the downward trend persisted. The second surrender event was driven by the mining industry.

China’s mining crackdown has forced miners to sell some of their stocks for fees in order to move operations out of the country. In addition, the Chinese authorities have suspended crypto-related banking transactions.

Grayscale Effect on Bitcoin Price

In total, about $ 6 billion was sold by retail investors, miners, and Chinese users in June, and the third surrender event may be the last but a bad one. Worst of the year, Mashinsky said:

“We’re about to see another wave of sell-offs … mostly from institutional GBTC trading worth $ 20 billion. Hedge funds that used leveraged loans from Genesis Trading and others in January and February 2021 to buy Bitcoin will be unlocked for the first time next week.

Grayscale Bitcoin Trust buys the underlying asset and offers GBTC shares to its customers. Shares are “blocked” for a period of 6 months and can be traded on the spot market at a discount or a premium. .

They are then free to trade their shares on the market and use the bonus. GBTC shares will be “activated” in the coming weeks. If most institutions buy GBTC stock when the price is between $ 20,000 and $ 30,000, profit-taking at the current higher prices will be inevitable.

Mashinsky believes this event will have a negative impact on the price of Bitcoin, as Grayscale will have to “sell” Bitcoin to compensate for hedge funds that want to abandon their positions. After that, Bitcoin price finally had a lull before bouncing back to previous highs and beyond.

“At least $ 5 billion will be released from GBTC, which could bring the Bitcoin price back to $ 29,000. After that July sell-off, things should turn for the better for the remainder of the year as ATH price breaks towards $ 140,000-160,000 per bitcoin. “

July will be an important month for Bitcoin. The main drivers seem to be at work in the market at the moment. To continue the rally, it looks like Bitcoin will hit new lows and weed out over-indebted players.

You can see the Bitcoin price here.

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According to Bitcoinist

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