Bitcoin is set for a negative 2nd quarter price close this weekend and indeed a very negative monthly close.
Individual positive or negative quarterly closes historically have little bearing on the next quarter as BTC can be seasonal.
Source: Tradingview.com
If quarterly closes flicks your switch, then you may be interested to know that the third quarter has historically been the weakest one for Bitcoin, with an average return of just 5% over the past 13 years.
During the Q3 of 2023 Bitcoin showed to be lackluster for with the top digital asset, down 11.5% quarter over quarter.
Volume, liquidity, volatility, and search trends all declined during the same period. This is commonly referred to as the summer lull.
Source: Coinglass.com
This period compares to average returns above 60% in both the second and fourth quarters.
Bitcoin derivatives traders are still showing confidence in a bullish price surge above $100,000 by September. But that optimism is going to be put to the test.
Source: Deribit.com
Looking at the CoT report for Bitcoin we can observe two very interesting things happening at the same time.
Long positions from Funds remain at record levels, while Leveraged money have Shorts opened at record levels.
Source: Tradingster.com
In such a scenario one would be inclined to believe that Leveraged money is always the dumb money and will be wiped out. This bodes well for a rebound in Q3.
It should be noted that Open Interest for Bitcoin has recently started to increase, further hinting at the potential for volatility.
Source: Coinglass.com
Given that the U.S. presidential election is a few weeks after the end of Q3 and we still don't know if the FED will signal a September rate hike at the next meeting.
If Bitcoin remains close to $60,000 at the end of the next quarter and if there is still no rate hike insight, then I'd be inclined to look for a retest of $45,000.
However, I remain optimistic that Bitcoin will outperform in July if Bitcoin can defend the $57,000 to $58,500 price zone next week.
Source: Tradingview.com
The low to medium-risk scenario for Bitcoin would be a minor new low next week, but one that quickly becomes bought.
That would, in my opinion, set about the very real chance of a Wyckoff pattern forming on the lower charts, and a substantial recovery probably in the magnitude of $10,000.
Source: Santiment.net
We should also take into account on-chain factors, such as the MVRV Ratio being oversold, bullish DAA divergence, and substantial mega whale buying.
My take on this third quarterly is that as long as Bitcoin does not break it's 200-day MA then a retest of $70,000 seems the most logical scenario in the short-term and $90,000 after the U.S. election.
