crypto-news-flash.com
- Bitcoin’s price has been range-bound, influenced by the cash-and-carry arbitrage strategy.
- Institutional trading behavior continues to reinforce range-bound expectations.
Bitcoin has been oscillating between $56,552 and $73,777 for several weeks, creating a highly volatile trading environment. Traders face the challenge of determining breakout directions within this unpredictable range.
Experts recommend waiting for a clear breach of resistance levels before making significant trades. As reported in Coin Market Cap news updates, this situation adds to the complexity of making significant trades.
Impact of Cash-and-Carry Arbitrage
Bitcoin’s recent price stagnation is primarily due to the cash-and-carry arbitrage strategy, as highlighted by Glassnode. This trading method involves taking a market-neutral position by purchasing $BTC in the spot market (going long) and simultaneously selling its futures contract (going short) when trading at a premium.
According to The Week Onchain Newsletter, this trend is likely to persist. In their Week On Chain report published on June 18, Glassnode analysts noted,
The cash-and-carry trade continues, with a particular uptick by institutional traders, reinforcing an expectation of range-bound trading for the time being.
Recent Price Movements and Market Impact
On June 18, Bitcoin touched $64,602, the lower boundary of its range. The downward trend of the 20-day EMA at $67,249 and an RSI below 40 indicate bearish dominance. If $64,602 fails, Bitcoin could drop to $60,000. However, a rebound above the 20-day EMA could push it to $70,000.
Despite significant inflows into crypto investment products, Bitcoin’s price remains range-bound. Glassnode noted that increased cash-and-carry trades—long positions in U.S. Spot ETFs and shorting futures on the CME Group exchange—diminish the impact of these inflows.
Additionally, Bitcoin’s price dropped 6% in the past week due to the Federal Reserve’s restrictive stance, shaking investor confidence and leading to $32 million in liquidations over the past 24 hours.
Long-Term Trends and Future Prospects
Bitcoin is now in its fifth epoch following the halving on April 20, which reduced miner rewards from 6.25 $BTC to 3.125 $BTC, significantly impacting miner revenue. Despite a 12% correction from the all-time high of $73,800, analysts remain cautiously optimistic.
As previously highlighted by CNF, analysts like CrediBULL Crypto suggest a potential bottom for Bitcoin around the $64,000 level. If broken, Bitcoin could drop to critical support levels at $60,000, $52,000, and $46,000. Currently, Bitcoin ($BTC) is priced around $64,946.79, reflecting a 0.24% decrease in the past day and a 4.87% decrease in the past week. View the $BTC price chart below.