Bitcoin Shows Early Bull-Market Characteristics

(MENAFN- Investor Ideas) newswire ) a trusted go-to platform for big investing ideas, including crypto stocks issues commentary from Bitfire Group Holdings Limited (01611).

Bitcoin has entered a high level consolidation phase near $80,000 following a breakout, exhibiting early bull market characteristics driven largely by short covering alongside strong technical momentum and upcoming macroeconomic catalysts. Here's Bitfire Research's latest assessment.

Bitcoin has entered a consolidation phase after breaking above its previous trading range and is currently fluctuating around $80,000. Bitfire Research finds that the move shows some characteristics of an early bull market, including a sharp reversal from lower levels, a rapid recovery and continued consolidation near previous highs without a clear breakdown.

Bitfire Research cautions, however, that the recent rally should not yet be treated as a confirmed trend. A significant part of the move was driven by forced short-covering rather than sustained spot buying. The key question now is whether spot demand can take over. Spot Bitcoin ETF flows, continued institutional allocations and whether the Coinbase premium turns positive again will be important indicators to watch.

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Recent spot Bitcoin ETF inflows totalled approximately $1.92 billion, while large-scale short liquidations accelerated the rally. With the Crypto Fear and Greed Index at elevated levels and the 14-day RSI around 78, the market is technically strong but increasingly stretched. Bitfire Research sees near-term resistance at $78,500 - $82,000, with support around $73,500 - $72,400. The next month will also be shaped by U.S. crypto regulation and macroeconomic data, including the expected procedural vote on the Clarity Act, the SEC's crypto framework consultation, the September FOMC meeting, PCE inflation data and payrolls.

A possible delay of Ethereum's Glamsterdam upgrade into the fourth quarter could also reduce near-term catalysts for ETH. Since mid-May, Bitfire Research has identified a high-value investment zone and reiterated that view on July 6 and July 13, when Bitcoin was trading near $60,000. Rising OTC activity, accumulation by large on-chain holders and the latest wave of short liquidations suggest that the market may be shifting from panic selling toward longer-term accumulation.

Looking ahead, Bitfire Research sees three potential sources of support: capital rotation from the increasingly crowded AI trade, institutional participation encouraged by clearer regulation, and stronger connections between traditional financial assets and digital assets through tokenisation. The immediate test is whether spot demand can replace short-covering as the market's main source of momentum. If institutional participation, regulatory progress and capital rotation continue to reinforce one another, the current move could mark more than a short squeeze - it could be the beginning of a new market cycle.

Author: Allen Ding, Director of Bitfire Research

Bitfire Group Holdings Limited (01611) is a leading digital asset financial services platform in Asia, committed to building the Asia-Pacific's first private-banking-grade digital asset steward. Holding SFC Type 1, 4 and 9 Licences issued by the Securities and Futures Commission of Hong Kong, the Group delivers compliant, secure and efficient one-stop digital asset services for institutional clients and high-net-worth individuals.

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