Bitcoin Rally at Risk as Spot Demand Weakens
The price of Bitcoin (BTC) is facing fresh risks due to weakening spot demand and potential profit-taking by short-term holders. According to the Coinbase premium index, spot buying in the U.S. has not kept pace with Bitcoin's recent price recovery, suggesting that a rally towards $85,000 may require stronger buying support.
A record $9 billion in unrealized profits among short-term holder whales is also causing concern, as these investors have historically been quick to lock in gains when prices weaken. This could prompt profit-taking and add further volatility to Bitcoin's recovery.
The Federal Reserve's upcoming rate hike decision in September will likely impact Bitcoin's price movement, as well as oil prices and the yen carry trade, which could create tighter financial conditions for the asset. Additionally, a bearish divergence between Bitcoin's price and on-balance volume (OBV) has been observed, with fewer buyers stepping in to support the cryptocurrency's move.