Arbitrum falls 10% amid weak on-chain activity – Can ARB hold $0.48?
- Why is crypto up today? Simply, BTC surged to $110K and broke out of its downtrend.
- Still, analysts expected a sideways structure or potential dips in summer.
Bitcoin [BTC] shrugged off the early-week dump and surged to $110,200 on the Binance exchange as of the 3rd of July.
The asset was up 12% from June lows, a move that analysts linked to strong interest in the spot and derivatives market.
Source: BTC/USDT, TradingView
On the 12-hour chart, BTC effectively broke out of its extended downtrend (white channel), raising hopes of a sustained upside move despite the typical summer lull.
Why is crypto up today?
At the time of writing, the entire market was green. Amongst L1s, Cardano [ADA] posted the biggest bounce of 8%, followed by Ethereum’s [ETH] 6.5% rise on the daily performance.
On the currency category, Litecoin [LTC] rallied 9%, while Solana [SOL], XRP, and BTC posted 4.7%, 4.5% and $2.3% respectively.
Source: CoinRank
Uniswap [UNI] led the DeFi market rebound with 9% while Bonk [BONK] jumped a whopping 20% amongst memecoins.
The lift-off and BTC upswing followed a strong daily ETF inflow of $407.78 million on the 2nd of July. This was a relief rebound in demand after a $342 million outflow on Tuesday.
At the same time, though, CryptoQuant noted that BTC’s speculative interest spiked 10%. This meant the rally was also fueled by leveraged bulls and could heighten liquidation or flushes.
Source: CryptoQuant
That said, Joshua Deuk, Head of Trade at Mozaik Capital, said that BTC was primed for a breakout.
According to him, the macro risk has eased after President Donald Trump stabilized Middle East tensions and oil volatility. The next catalyst would be a likely Fed rate cut in September.
Still, he expected a range-bound activity until September after the summer holidays.
“No major macro risks on the calendar until September. That’s when people get back to desks, + real activity picks up again.”
However, other analysts remained cautious. In particular, Santiment warned that the rally was driven by retail FOMO and could face a sharp pullback as the market always goes against them.
For Swissblock analysts, the breakout lacked a strong spot market demand to be sustainable.
Source: Swissblock
In fact, BitMEX Founder, Arthur Hayes, warned that a liquidity squeeze could create the typical summer lull, forcing risk assets into a sideways structure or potentially drag BTC to $90K.
