After closing June with its highest monthly close since inception, Bitcoin (BTC) has signaled bullish sentiment for July. The cryptocurrency surged 4% on July 2, trading around $109,420 during mid-North American sessions. However, midterm bearish risks persist due to cumulative short leverage trades and negative funding rates.
Key Factors Influencing Bitcoin’s July Performance
1. Global Money Supply (M2) Correlation
Bitcoin’s price mirrors the exponential growth of the global M2 supply. With the U.S. government likely to increase its budget deficit, expanding money supply could further boost BTC’s appeal as a hedge against inflation.
2. Spot BTC ETF Inflows
U.S. spot Bitcoin ETFs, led by BlackRock’s IBIT, recorded $12.8 billion in net inflows over three months. Sustained demand from these products will be critical for July’s momentum.
3. Institutional Demand & Exchange Supply Shock
Rising institutional investments have sharply reduced available BTC on centralized exchanges, intensifying the supply-demand imbalance. Monitoring corporate treasury movements (e.g., MicroStrategy) will provide additional price clues.
Midterm Price Targets and Risks
Bullish Scenario:
- BTC broke a key logarithmic resistance trendline on July 2, positioning it for a potential all-time high (ATH) if it holds above $109k.
- Bitwise CIO Matt Hougan predicts ATH breakthroughs in July, citing easing geopolitical tensions and institutional demand.
Bearish Invalidation:
- A drop toward the $92k–$96k support range (lower border of the falling channel) would negate bullish momentum.
Historical Trends and July Outlook
Bitcoin has historically posted gains in most Julys over the past decade, reinforcing seasonal bullish expectations. Institutional adoption and macroeconomic trends remain the primary drivers.
FAQ Section
Q: Why is institutional demand important for Bitcoin’s price?
A: Institutional investments reduce exchange liquidity, creating supply shocks that amplify price rallies.
Q: What risks could derail BTC’s rally in July?
A: Geopolitical tensions, unexpected ETF outflows, or a drop below $92k support.
Q: How do spot BTC ETFs impact the market?
A: They provide regulated exposure, attracting capital that directly increases buy-side pressure.
👉 Explore Bitcoin’s latest trends and institutional impact
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