After a continuous decline since last October, Bitcoin is showing signs of forming the bottom of the market cycle.
According to Fidelity Research Analyst Zach Wainwright, long-term Bitcoin holders (those who have held it for more than six months) are approaching a record high of 15 million Bitcoin.
Meanwhile, more than 40% of this supply is underwater, reflecting past historical patterns.
Nearly 40% of this supply is now at a loss – a level that was previously in line with Bitcoin’s bottoming out process. Main question: Did history begin in rhyme?
On a 30-day average, Bitcoin’s supply loss rose to 50% as the asset fell below $63,000 on Friday, July 17.
In the past, Bitcoin bottomed when the supply loss reached around 46%-56%. In 2022, BTC bottomed near $16k, and the supply at loss peaked at 50%.
Although history rhymes, past patterns do not always predict future outcomes. In fact, ongoing macro and geopolitical pressures may limit risk appetite for cryptocurrencies and the US stock market in the third quarter, According to To other analysts. Institutional demand is already enhancing this.
Demand for spot Bitcoin ETFs in the US remains weak
Despite recording three straight days of inflows since Tuesday, US spot bitcoin ETFs have been muted on a monthly average.
According to Glassnode, the two largest entities, BlackRock and Fidelity, have seen ongoing institutional selling rivaling 2025.
30-day ETF outflows averaged more than 2 thousand BTC per day in June and early July. This has fallen slightly to around 1,250 BTC per day this week, but speculative interest has also declined, as evidenced by ETF trading volumes.
For Glassnode, this meant that any potential recovery in Bitcoin prices could be delayed unless institutional demand improves.
Directional conviction and activity levels between the top two ETF vehicles remain very weak. Any lasting recovery will need to significantly reverse this dynamic.
As of writing, Bitcoin (BTC) It was trading at $62.8K, down 4% and on the verge of erasing all the gains made after the relief hike triggered by a weak CPI reading.
Institutions and professional traders did not rule out further decline, as evidenced by the selection of options positions.
In the last 24 hours, the top option volumes were concentrated at $62.5K and $56K for the put price target (bearish bets), confirming the massive hedging for further downside protection.
However, there was high call volume (bullish bets, green bars) looking at $68k and $79k. This was confirmed by A Possible side structure Expectations in July range from $55,000 to $70,000.
Overall, the $60,000 level has been a major support, and metrics suggest that it could become a potential bottom of the market cycle. However, sharp moves below $60,000 cannot be negated in the short term amid macro headwinds.
Final summary
- Fidelity predicts that Bitcoin is likely at the bottom stage of the cycle as the supply in loss reaches +40%.
- Meanwhile, traders were betting that Bitcoin’s price could fall to $62.5K or $56K this month.
