The Nasdaq dropped 7.5% in the last week, evaporating $2.7 trillion in market cap, which is more than double BTC's entire market cap. Oil prices shot up to $90, and the Producer Price Index jumped to 6.5%, with the market starting to price in a Fed rate hike in September. In this macro environment, BTC has managed to hold above $63,000, which is stronger than I expected.
The miners are flashing red signals. Charles Edwards from Capriole says that BTC's current trading price is basically the miners' production cost, around $61,200, with a profit margin of only 4.67% after electricity costs, close to a two-year low. Bitbo's miner capitulation indicator has also lit up; historically, when this signal appears, it often indicates an accumulation window. Killa mentioned that the traditional markets might see another pullback later this year, which could be the real bottom for BTC, but the miners are already capitulating.
The daily RSI for BTC is only 34, in the oversold territory. The 4-hour RSI has bounced back to 57, and the MACD histogram has turned positive, indicating a recovery in momentum. The funding rate is at 0.0008%, which is quite low, suggesting that this rebound isn't driven by leverage. In June, ETFs saw $1.9 billion in outflows, and Strategy has paused its buys, reflecting weak market sentiment. However, SpaceX's IPO was oversubscribed by more than double, with a valuation of $1.77 trillion, indicating that money hasn't fully exited; it's just waiting for direction.
The situation with ETH is even more interesting. ETH futures open interest on Binance has hit an all-time high of 3.7 million ETH. The taker buy/sell ratio has returned from 0.95 to 1.0, with sellers finally starting to balance after dominating for so long. However, the ratio of perpetual contracts to spot trading volume is nearing historical highs, with leverage participation outpacing spot, which is something to watch out for. After ETH fell 44%, leveraged longs are adding positions; if they're right, it's a massive win, but if they're wrong, it could lead to a liquidation cascade.
The macro environment is indeed challenging, with oil prices, inflation, and rate hike expectations deteriorating. But the miner capitulation, combined with an oversold RSI, healthy funding rates, and the excitement around large IPO subscriptions, indicates that the market is bottoming out rather than crashing. The $60,000 mark is a critical support level; if it breaks, the $48,965 electricity cost line is the miners' last line of defense. Now is not the time to FOMO, but it's also not a time to panic.
The miners are flashing red signals. Charles Edwards from Capriole says that BTC's current trading price is basically the miners' production cost, around $61,200, with a profit margin of only 4.67% after electricity costs, close to a two-year low. Bitbo's miner capitulation indicator has also lit up; historically, when this signal appears, it often indicates an accumulation window. Killa mentioned that the traditional markets might see another pullback later this year, which could be the real bottom for BTC, but the miners are already capitulating.
The daily RSI for BTC is only 34, in the oversold territory. The 4-hour RSI has bounced back to 57, and the MACD histogram has turned positive, indicating a recovery in momentum. The funding rate is at 0.0008%, which is quite low, suggesting that this rebound isn't driven by leverage. In June, ETFs saw $1.9 billion in outflows, and Strategy has paused its buys, reflecting weak market sentiment. However, SpaceX's IPO was oversubscribed by more than double, with a valuation of $1.77 trillion, indicating that money hasn't fully exited; it's just waiting for direction.
The situation with ETH is even more interesting. ETH futures open interest on Binance has hit an all-time high of 3.7 million ETH. The taker buy/sell ratio has returned from 0.95 to 1.0, with sellers finally starting to balance after dominating for so long. However, the ratio of perpetual contracts to spot trading volume is nearing historical highs, with leverage participation outpacing spot, which is something to watch out for. After ETH fell 44%, leveraged longs are adding positions; if they're right, it's a massive win, but if they're wrong, it could lead to a liquidation cascade.
The macro environment is indeed challenging, with oil prices, inflation, and rate hike expectations deteriorating. But the miner capitulation, combined with an oversold RSI, healthy funding rates, and the excitement around large IPO subscriptions, indicates that the market is bottoming out rather than crashing. The $60,000 mark is a critical support level; if it breaks, the $48,965 electricity cost line is the miners' last line of defense. Now is not the time to FOMO, but it's also not a time to panic.