Bitcoin Price Action Teeters Ahead of US CPI Report

Bitcoin's price action has been closely watched ahead of Tuesday's US Consumer Price Index (CPI) report, with analysts warning that a late-stage bear market may be brewing. According to Bitfinex analysts, Bitcoin's on-chain structure is reading as a 'late-stage bear,' even though long-term holders are accumulating every week.

Bitfinex noted that the $60,000-$63,000 shelf is not yet flow-supported and called 'a shock outflow' the biggest risk ahead of Tuesday's CPI print. The analysts also pointed out that Bitcoin has traded below its short-term holding-cost basis for 9 months, a trend that has paralleled bear-market cycles.

Fidelity's Jurrien Timmer said Bitcoin may be entering an 'accumulation zone,' with his power-law model predicting support near $58,000 and $62,685. The model is built on the assumption that Bitcoin's long-term price follows a mathematical power-law relationship with the time elapsed since its genesis block.

Despite the accumulation of long-term holders, analysts warned against calling a bottom given thin institutional conviction. The 10-day streak of ETF outflows was broken on July 2, but the rally faltered amid geopolitical flare-ups.