Bitcoin Surges 0.9% in July Driven by Institutional Demand

Bitcoin experienced a notable rise in July, driven by several institutional market signals that bolstered investor confidence. The cryptocurrency showed a slight increase of 0.9% in the last 24 hours, recovering from a dip after its record monthly close at the end of June. This upward trend was further supported by a surge past $107,500, sparking optimism among market participants amidst ongoing geopolitical tensions and tariff disputes.

Historically, July has been a favorable month for Bitcoin, with potential for a rally if it can break key resistance levels. The cryptocurrency's price movements were closely watched as it consolidated above $105,000, indicating strong institutional demand. Analysts pointed to several macro factors that could drive Bitcoin's price higher, including geopolitical scares and increased institutional buying. According to the analyst's forecast, Bitcoin's price could surge to $136,000 in July due to these factors.

The bullish momentum was further reinforced by Bitcoin's ability to resume its upward trajectory, returning above $107,000 despite spot ETF outflows. This resilience was attributed to increasing institutional interest and the potential for a massive breakout, as indicated by a cluster of on-chain and macro factors. The cryptocurrency's price change course on Wednesday, paving the way for a break above the $107,000 mark, with an upward-facing Relative Strength Index (RSI) and a bullish Money Flow Index (MFI) indicator supporting this movement.

Traders were advised to look out for a daily close above $107,000 to validate the uptrend's strength, with movement above $108,000 likely to boost risk-on sentiment for a breakout beyond the $110,530 high tested on June 9. However, caution was advised as most investors were now back in profit, with a super-majority of Bitcoin investors holding unrealized profits. If a reversal occurs, key support levels would include the $105,100 mark tested on Wednesday, the 50-day Exponential Moving Average (EMA) currently at $104,306, and the 100-day EMA at $100,570.

The institutional rush for Bitcoin continued, with public companies increasing their Bitcoin holdings by 131,000 BTC, a surge of 18%, while ETF inflows rose by approximately 8%. This increased institutional demand was seen as a positive signal for Bitcoin's price, as it indicated growing acceptance and investment from traditional financial institutions. The cryptocurrency's supply in profit also rose sharply to 98% from 87% between June 22 and Sunday, further supporting the bullish outlook.

In summary, Bitcoin's rise in July was driven by a combination of institutional market signals, historical performance, and macro factors. The cryptocurrency's ability to consolidate above key resistance levels and resume its upward momentum indicated strong demand from institutional investors. However, traders were advised to remain cautious and monitor key support levels to navigate potential reversals. The increased institutional demand and growing acceptance of Bitcoin as an investment asset were seen as positive signals for its future price movements.

Bitcoin has made gains into July despite a lackluster sentiment in the derivatives markets. Wintermute provided insights on BTC's funding rates, while CME Group rolled out new futures contracts. In this landscape, institutional players, including CME Group and Bill Pulte from FHFA, are driving significant regulatory and product advancements. The price increases in BTC are observed against a backdrop of low derivatives activity. However, the introduction of spot-quoted futures highlights institutional confidence. On-chain realized profits reached $2.4 billion, driven by long-term holders.

These market actions affect several cryptocurrencies, primarily BTC, with altcoins like ETH and SOL following due to related ETF and futures news. Institutional shifts might influence liquidity, hedging products, and staking in the near future. Emerging financial products such as the REX-Osprey Solana Staking ETF signal significant liquidity shifts for SOL. Historical data indicates slow derivatives movement can precede market adjustments for major cryptocurrencies. The tranquil state of the derivatives markets may temporarily align with July's typical BTC upward trajectory. Future infrastructure changes and regulatory movements are worth observing for potential long-term impacts.