Bitcoin Price Stuck Trading Sideways, but Is $80K Rally in the Cards?

The hold on rates aligned with market expectations, but analysts remain split on Fed chair Kevin Warsh’s presser comments, along with his longer-term plan to handle inflation.

“Soft Q2 GDP (1.5%, below expectations) + cooler June Core PCE (0.1% MoM / 3.3% YoY). This data reduces the odds of a rate hike. Plays perfectly into our thesis: highest probability remains no rate cut for the rest of the year, with P(cut) > P(hike).”

Following Warsh’s presser, Treasury yields initially spiked. The 30-year bond hit its highest level since 2007 at 5.2%, while the 10-year note yield climbed to 4.6%. Equities initially softened during the press conference, but PCE data and a late-week relief rally led by tech and AI stocks pushed markets into the green by the end of the week.

The Rundown

• Bitcoin Ping Pongs on FOMC, PCE, Tech Stock Rebound
• Ethics and Consumer Protection Issues Muddy CLARITY Act Progress
• Bitcoin Rejects New Lows Despite Waves of Negative Newsflow
• What’s on the Radar?

Bitcoin Ping Pongs on FOMC, PCE, Tech Stock Rebound

Bitcoin failed to sync with the stock market rally, falling to a two-week low of $62,466. Aside from the usual futures activity playing an outsized role in BTC’s price action, Strategy reported an $8.22 billion loss due to fair value changes. The company also re-emphasized its openness to selling Bitcoin in the future to increase USD reserves, affirming the view that the flagship bid from the market’s largest corporate Bitcoin treasury is effectively halted.

In an X post, the company said, “We intend to remain a regular, disciplined buyer of STRC below $100.” Strategy also explained that "repurchases will be funded outside the USD Reserve, including through MSTR and BTC sales, based on market conditions.”

Ethics and Consumer Protection Issues Muddy CLARITY Act Progress

On the regulatory side, ramped up efforts to push the CLARITY Act to a US Senate floor vote appeared to lose momentum, but advocates remain hopeful. Senate Majority Leader John Thune said the goal is to get the floor vote done before the August 7 recess. However, unresolved issues related to ethics and consumer protection continue to generate friction.

Despite falling odds of CLARITY passing before the US midterm elections, Bitcoin’s corporate bid fading and a market still wary of possible interest rate hikes, market structure for crypto majors continues to improve. This raises the real question of whether the bulk of the “bad news” is already known and priced into Bitcoin and the wider crypto market.

Bitcoin Rejects New Lows Despite Waves of Negative Newsflow

Bitcoin’s cumulative volume delta showed $754 million in buy volume on July 30. Meanwhile, spot BTC ETFs took in roughly $204 million over a four-day period. The past two weeks of ETF flows suggest that a light institutional bid is holding despite negative factors like Strategy becoming an idle player over the past 5 weeks.

Bitcoin ETF tracker. Source: CoinMarketCap

Futures data shows leveraged longs accounted for about 50% of the $286 million in liquidations on July 30. However, the funding rate remains tilted toward longs who remain at risk of liquidation in the $62,500 to $63,500 range. Short traders, on the other hand, risk being squeezed in the $64,500 to $65,500 zone.

Bitcoin price, aggregate open interest, funding rate. Source: Hyblock

The current view, which mirrors previous weeks, is that open interest is slowly rebuilding after a 5.2% flushout on July 21. As longs deleveraged leading into the FOMC meeting, they added to BTC’s price weakness. Signs of a bearish reversal would include rising OI alongside a falling price and failure of $62,000 to hold.

BTC/USDT liquidation heatmap. One-month lookback. Source: Hyblock

What’s on the Radar?

• Markets rallied following the Situational Awareness hedge fund sale. If the AI rout found a bottom, will rising risk sentiment spill over to crypto?
• Markets appeared to price in Strategy becoming a Bitcoin seller for the foreseeable future and ETF flows are on a two-week net positive streak. Can futures traders push prices to $66,000 and higher?
• There’s still a chance for the CLARITY Act to make it to a Senate floor vote, and then President Trump’s desk. Will traders front-run improving odds or other positive news in Bitcoin, ETH and DeFi tokens?