June 16, 2024
Bitcoin

Bitcoin set for new all-time high next week but Ethereum holds it back


Crypto research firm 10x Research has warned that a sharp decline in Ethereum prices could prevent Bitcoin from reaching a sustainable new all-time high of over $83,000, according to a June 7 analysis shared with CryptoSlate.

During the past week, ETH’s price has considerably struggled compared to Bitcoin’s price. The second-largest digital asset fell by around 1.2% during the period, while BTC’s price rose by more than 3%. While not explicitly explained in the note, 10x Research believes Ethereum could hold Bitcoin back from a sentiment perspective.

10x Research, citing Ethereum’s future position, noted that traders were more willing to punt on BTC. Additionally, the firm predicted that demand for ETH exchange-traded funds (ETFs) would fall short of expectations.

It stated:

“Positioning in Ether futures is already stretched, and as SEC Gary Gensler said this week, it might take a while until those (S-1) ETH ETFs are approved. Futures positioning increase in ETH has lagged this week at $0.3 billion as traders prefer to buy Bitcoin exposure at this point, [recording] $2.2 billion. The numbers speak for themselves.”

How BTC can reach new ATH

Meanwhile, the firm believes Bitcoin may hit a new all-time high of $83,000 soon if it breaks a key technical pattern as early as today, June 7, or by Wednesday, June 12.

Markus Thielen, the CEO of 10x Research, said:

“It’s only a matter of time until Bitcoin hits a new all-time high. The head-and-shoulders formation indicates a rally toward $83,000 soon, with the resistance line likely breaking within the next few days.”

The firm attributed its bullish outlook to recent global economic activities, including interest rate cuts in Canada, Denmark, and Europe. The prediction also considers a weaker US employment market and a potential decline in inflation as factors supporting the new ATH.

10x Research further explained that it typically takes about $800 million or $8 billion in inflows to increase Bitcoin’s price by 1% and 10%, respectively. These inflows come from various sectors, including Bitcoin ETFs, which recently accounted for 35% of total Bitcoin flow.

So, to achieve a weekly Bitcoin rally of 5%, the market would need $4.2 billion in inflows, with Bitcoin Spot ETFs seeing $1.7 billion. However, to reach its projected new all-time high of $83,000, 10x Research expects Bitcoin to require over $13 billion in inflows across all sectors. It added:

“A breakout above the $71,600 trend line will naturally result in more upside buying through multiple products, but $13 billion [in inflows] requires quite some commitment. Nevertheless, we think this is possible as a weaker US employment market (unemployment rate at 4.0%) and lower inflation data next week (3.3%) will likely provide the macro backdrop for new all-time highs.”

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