Signal 1 – Technical Analysis Signal, Monthly MACD-Histogram
The bullish crossover signal of the monthly MACD-Histogram is not a commonly seen positive signal in Bitcoin price history. It has only appeared twice prior to 2023. And with the closing price of June, this signal has been confirmed to appear for the third time.
The first occurrence in late 2015, the bullish MACD-Histogram crossover signal initiated a rally of 4,000%.
The second occurrence in 2019, it initiated a rally of 450%.
In this third occurrence, many technical analysis-oriented investors believe that it is confirming a strong upward momentum until the end of 2023.
It is also important to note that the observation above is made using the monthly candlestick closing prices. Therefore, it accommodates significant price swings within the month as long as the price can recover and close in an upward trajectory.
Signal 2 – The Bitcoin supply is approaching historical lows
Regardless of the price of BTC, the available supply of BTC for purchase is becoming increasingly scarce.
The available supply of Bitcoin for purchase refers to the amount of BTC that is circulating in the market and not held by long-term holders. Assuming new investors come in, they would need to buy it at a higher price. And as the price increases, new sellers would emerge.
The available supply of Bitcoin is currently decreasing and approaching its historical lows. The lowest level was recorded back in 2015-2016. During that time, Bitcoin also entered a sideways phase at the bottom of a new bullish cycle.
Signal 3 – The number of Bitcoin wallet addresses depositing to exchanges is decreasing to an unprecedented low level
The fewer Bitcoin wallet addresses depositing BTC onto exchanges, the more it demonstrates the “hodling” conviction of Bitcoin holders. There seems to be a significant shift in the perception of Bitcoin investors. Unlike previous cycles, they maintain a strong belief that the price of Bitcoin will inevitably rise.
The data for Bitcoin Depositing Addresses in July recorded the lowest level in BTC price history. This will contribute to reducing selling pressure on BTC even when negative news appears. In the long run, it contributes to increasing the scarcity of Bitcoin in the market.
Signal 4 – The trend of accumulation by investment funds is increasing again.
Investment funds are increasing their level of Bitcoin accumulation to levels comparable to the late 2022 period. The notable aspect is the speed of their accumulation. In just the last two weeks of June, funds have rapidly resumed accumulation at the highest levels in terms of quantity and volume since Q4/2022 until now.
Signal 5 – The inflow of funds from crypto investment funds is showing signs of reversal
If we consider not only Bitcoin but also other cryptocurrencies, the Digital Asset Fund Flows Weekly data from CoinShares indicates a significant shift in the last week of June. This data tracks the inflow/outflow of funds from ETPs (Exchange-Traded Products), mutual funds, OTC custody funds related to BTC, and other crypto assets.
CoinShares has recorded 8 consecutive weeks of outflows. However, in the last week of June, there was a significant inflow of nearly 200 million USD. From a technical perspective, this is clearly a sudden reversal of sentiment from negative to positive.
This psychological reversal stems from the expectation of a Bitcoin ETF backed by the industry giant BlackRock.
Signal 6 – The market’s expectation for derivatives has “reversed” in July
Since its launch, CME Bitcoin Futures contracts have consistently maintained a Net Short position (i.e., more Short positions than Long positions). It was only during the 2022 downtrend phase that the data began to show a Net Long position (i.e., more Long positions than Short positions). In late June and early July, the data returned to a Net Long position. Additionally, the trading volume (measured in USD) has shown signs of a slight increase in recent weeks.
Therefore, the sentiment is showing signs of reversal. This reflects that the majority of investors are predicting that BTC will continue to rise in July.
Signal 7 – The value of payments on the Bitcoin network has stabilized again
The total value of Bitcoin payments on the network somewhat reflects the level of utility and measures the enthusiasm of users in conducting transactions with Bitcoin.
Despite the monthly settlement value having decreased by 90% from its peak, at least in recent months, the data also shows a slight increase and stability. This stability serves as a basis for expecting that the demand for transactions on the Bitcoin network will continue to increase or remain steady in the second half of 2023.