Two groups of BTC investors sell on the rise as prices near $65,000.

Bitcoin prices approach $65,000, driven by favorable inflation data, but two investor groups are selling, raising concerns about the rally's sustainability.

Bitcoin is making headlines again, as prices surge toward the $65,000 mark, buoyed by softer-than-expected inflation data from the U.S. But amidst this bounce, two distinct groups of BTC investors are actively selling into this rally, raising questions about the sustainability of this price recovery.

What Are the Signals from Long-term Holders?

Recently, Bitcoin has jumped to nearly $65,000, driven primarily by favorable inflation reports for June. However, this price movement has not swayed all investors. According to on-chain analytics from Glassnode, long-term holders—defined as wallets that have held BTC for at least five months—are capitulating. They are selling their coins, often at a loss, rather than waiting for deeper drawdowns in price. This behavior underscores a lack of confidence in the recent price bounce's sustainability.

Is It Just Short-term Profit-Taking?

Short-term holders are also contributing to the selling pressure. These investors, who bought Bitcoin near recent lows, are now realizing profits at a significant rate, exceeding $4 million per day. This flood of selling resembles previous patterns seen back in May, when BTC briefly rose above its 200-day average around $82,000. This simultaneous selling from both long-term and short-term holders is likely creating an overhead supply just as the market attempts to push higher.

What Does the Market Data Say?

Bitcoin's recent bounce came from a price point of about $61,500 earlier this week, largely thanks to reports showing the U.S. consumer price index (CPI) rose by only 3.5% year-over-year in June—below the expected 3.8%. This represented a significant cooldown from previous months. However, some analysts caution that this optimism may be misplaced. The observed slowdown in inflation was significantly influenced by a 10% drop in gasoline prices, which has already reversed to some extent.

Are Market Conditions Favorable for a Sustainable Rise?

Analysts are expressing skepticism about the sustainability of this inflation-led price recovery. Ryan Lee, chief analyst at cryptocurrency exchanges Bitget, pointed out that while the inflation data might initially seem positive, factors like the recent rise in oil prices could complicate matters. “Markets are rallying on a June photograph,” he commented, indicating that the data may not accurately reflect current realities due to ongoing global tensions.

What Concerns Do Experts Have?

Jasper De Maere, an OTC trader at Wintermute, also called for caution, recognizing the investor sentiment shift but maintaining that soft CPI data should not overshadow ongoing geopolitical issues. The Fear & Greed Index has only risen slightly from 22 to 25, still indicating a state of extreme fear in the market. De Maere stated, “One soft CPI print against an active military escalation is not the same as a durable regime shift in risk appetite.”

Could This Trigger Further Selling Pressure?

With both long-term and short-term holders taking profits or locking in losses, the potential for further selling pressure looms over Bitcoin's attempted rise. The recent influx of seller behavior indicates a shaky conviction among those still left underwater from previous price peaks.

• Bitcoin's price has surged to nearly $65,000, backed by positive inflation data.
• Both long-term and short-term holders are selling into the current price rally.
• Selling volumes exceed $4 million per day, pointing to strong profit-taking.
• Many analysts express skepticism regarding the sustainability of this rebound, citing geopolitical tensions and investor sentiment.

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