Bitcoin Surges 9% to New All-Time High of $118,000

Bitcoin (BTC USD) has recently surged past $118,000, marking a new all-time high after an impressive 9% rally this week. The driving forces behind this significant price increase are multifaceted, with several key factors contributing to the bullish momentum.

The latest surge in Bitcoin's price can be attributed to a supply shock. Despite headlines indicating that all holders were in profit, the level of sell pressure remained relatively low. This dynamic was further supported by aggressive outflows of Bitcoin from exchanges, as exchange reserves dipped below 2.4 million coins. This trend continued even as Bitcoin faced resistance at the $110,000 price level since late May, indicating that a breakout was imminent due to sustained buying pressure.

Whale activity also played a crucial role in the recent rally. Early in the week, whales executed large bullish positions in the derivatives segment, despite selling in the spot market. This shift in whale behavior, particularly their aggressive accumulation of Bitcoin, injected significant liquidity into the market, driving the price to new highs. Most of the spot sales were observed on Binance, while whales were predominantly active on Coinbase. However, recent data from CryptoQuant indicated that Binance whales took over during the surge. Despite heavy profit-taking and short positions, the aggressive short liquidations triggered a short squeeze, where liquidated accounts were forced to buy to cover their shortfalls. More than $654 million worth of short positions were liquidated in the last 24 hours, according to Coinglass.

Institutional investors also contributed to the rally. Bitcoin ETFs maintained overall positive flows in the last 30 days, with only one day of negative flows recorded on 1 July. Notably, Bitcoin ETFs recorded $1.17 billion worth of inflows on 10 July, the highest single-day inflows ever recorded. BlackRock’s Bitcoin ETF led the inflows at $448.5 million, providing a significant boost to the bullish sentiment. The decision by Jerome Powell to step down as the SEC chairman also reignited prospects of lower rates, further fueling the bullish momentum. At press time, Bitcoin was still trading above $118,000, confirming the continued bullish momentum. However, the price approached levels that some analysts predicted to be its top before the end of 2025, which could encourage short-term sell pressure. The observation of whales taking profits also signaled a potential cooldown during the weekend. Bitcoin was already oversold at press time and formed a bearish divergence with its RSI, indicating that bears may challenge the bulls driven by profit-taking. Conversely, more upside remained possible if the short squeeze prevailed.