Bitcoin Hits $112,052 All-Time High Amid Bullish Trend

Bitcoin's price surged to a new all-time high of $112,052 on Wednesday, prompting some investors to reassess their positions. Analysts have cautioned that traders who are underexposed could be caught off guard if the rally persists. 10x Research analysts predict that Bitcoin's latest breakout could extend well into the third quarter, with a potential price target as high as $133,000.

Markus Thielen, head of research at 10x Research, noted that the firm’s Bitcoin trend model turned bullish on June 29. This model now assigns a 60% probability to Bitcoin continuing its upward price movement over the next two months. Thielen's analysis suggests a potential 20% gain during this period, which could push Bitcoin's price to around $130,000.

Thielen attributes the surge to relentless ETF demand and a series of upcoming policy catalysts. He also mentioned that many traders are underpositioned following the previous month’s option expiry, leading to a significant exposure roll-off. Despite this, Thielen remains optimistic, stating that current trading signals support the continuation of this bullish trend.

Bitcoin traders are predominantly buying calls, indicating a sentiment of being underexposed to further upside. Market participants may be racing to catch up with Bitcoin’s rally rather than driving it through spot buying. Thielen also predicts that the current market bull run will likely extend into September, especially if upcoming macroeconomic events are favorable.

Economists expect a "benign" CPI print in the US Consumer Price Index (CPI) report scheduled for release on July 15, which could push people towards buying positions. Although the third quarter hasn't always been Bitcoin's most favorable time of the year, with an average return of just 5.84% since 2013, Thielen is confident this year could be an exception. He cites US pro-crypto policy changes and green ETF flows as reasons for his optimism.

Even during weeks of consolidation, there was approximately $15 billion in silent accumulation through the US-based spot Bitcoin ETFs. On Wednesday alone, these ETFs attracted $215.7 million in inflows. Traders previously sitting on the sidelines are seemingly being forced to re-enter the market, potentially at much higher prices.

10x Research revealed that it has entered a long position in Bitcoin at $104,000, hedged with a $115,000 call option. The core position is up by $7,000, but the option has only gained $450 because of the market’s reduced implied volatility and time decay. Thielen said the trade was performing as expected and will soon transition into a higher trading range.

Ethereum surged over 5% on Wednesday, outperforming Bitcoin, Ripple, and Solana. The rally was accompanied by record trading activity in BlackRock’s spot ether ETF, ETHA, listed on Nasdaq. More than 43 million shares of ETHA changed hands on Wednesday, the highest daily volume since the fund’s debut a year ago. Investor interest has translated into robust capital inflows, with over $1.2 billion added to the fund since June. On Tuesday alone, net inflows reached $159 million, the largest single-day total since June 11.