The Bitcoin Monthly: Bitcoin Battles Resistance Around Its On-Chain Mean – Ark Invest Report
Ark Invest has released its latest report titled “The Bitcoin Monthly: Bitcoin Battles Resistance Around Its On-Chain Mean,” offering a comprehensive analysis of the current state of the market. The report categorizes its findings into bullish, neutral, and bearish perspectives, providing a holistic view of Bitcoin’s current and potential future position.
Bullish Arguments For Bitcoin
Grayscale Spot ETF and GBTC’s Discount To NAV: The recent ruling by a US Federal Appeals Court requiring the SEC to reconsider its rejection of the Grayscale Bitcoin Trust’s application for a spot ETF has generated market optimism, as evidenced by the narrowing discount to NAV.
Bitcoin’s General Cost Basis Recovery: The steep drawdown in Bitcoin’s realized capitalization indicates capital outflows from the network, which could potentially pave the way for a stronger bull market.
Futures Open Interest Collapse: The rapid liquidation of Bitcoin futures suggests a cathartic sentiment correction in the market.
Neutral Arguments
Bitcoin Price and the 200-Week Moving Average: Bitcoin’s price dip below its 200-week moving average presents a challenge, but it may find support at its realized price.
Bitcoin’s On-Chain Mean Resistance: The on-chain mean, calculated by dividing investors’ cost basis by the number of active coins, has reached a significant resistance level, indicating potential challenges for Bitcoin.
Stablecoins Market Cap and Liquidity: The decline in stablecoin supply signals reduced on-chain liquidity, but net inflows suggest a building bullish market momentum.
Bearish Arguments For BTC (All Macro)
Real GDP vs. Real GDI Growth Rates: The divergence between real GDP and real GDI growth rates raises concerns about the accuracy of GDP as an indicator of economic performance.
Real Federal Funds Policy Rate vs. Natural Rate of Interest: The Real Federal Funds Policy Rate surpassing the Natural Rate of Interest indicates a shift towards restrictive monetary policy, which could impact lending and borrowing.
Government’s Employment Revision: Downward revisions in nonfarm payroll statistics suggest a weaker labor market than initially reported, which could have implications for the overall economy.
Hot Take
Ark Invest’s report presents a range of arguments for Bitcoin, highlighting the potential turning point in the market. With three bullish, four neutral, and three bearish arguments, it is clear that Bitcoin’s future trajectory remains uncertain. At the time of writing, Bitcoin is trading at $25,789.
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