The price of bitcoin quickly rebounded after dropping to $61,300. The decline started after news that Strategy sold part of its BTC holdings. Initially, this hit trader sentiment, but then the market focused on the other side of the deal: the company received another $216 million in cash. This slightly eased concerns about dividends and debt payments.
After such a pullback and quick recovery, market participants are once again asking: are buyers regaining control, or is this just a short-lived bounce?
Annualized funding rate for bitcoin perpetual futures. Source: Laevitas.
On Monday, the annualized funding rate for bitcoin perpetual futures rose to 9%. This indicates that demand for leveraged longs and shorts has become more balanced.
A confident bullish signal is still a long way off, but the situation already looks better than on Saturday. Back then, funding rates went negative, which pointed to a clear dominance of bearish sentiment.
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The options picture turned out to be a bit more cautious. Unlike futures, this market on Monday was still showing signs of tension.
Put-to-call option premium ratio for bitcoin on the Deribit exchange. Source: Laevitas.
On Deribit, the premium for put options was again higher than for call options. This means market participants became more active in paying for downside protection, although on Thursday and Friday the situation was the opposite.
During periods of strong panic, this indicator easily goes above 2. Right now, it is around 1.15, so it is too early to talk about serious fear.
Overall, bitcoin futures and options withstood the pressure. But even the rise of BTC to $63,500 did not make traders massively believe in the return of a bullish trend.
Inflows Into Bitcoin ETFs Could Help BTC Reach $65,000
Bears may have underestimated an important signal from US spot bitcoin ETFs. On Friday, the funds recorded a net inflow of $223 million. This was the first positive day after ten consecutive trading sessions of capital outflows.
June was tough for ETFs. Over the month, investors withdrew a record $4.51 billion, which put significant pressure on market sentiment.
But if outflows are really starting to reverse, it may become harder for sellers to maintain the initiative. Sustained inflows into ETFs could revive interest in bitcoin and in the derivatives market.
Daily net inflows and outflows for spot bitcoin ETFs trading in the US. Source: SoSoValue.
Some of the pressure on BTC is not only related to ETFs, but also to Strategy itself. Its perpetual preferred shares Stretch under the ticker STRC dropped significantly, even though they offer investors a yield of about 12%.
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The problem is that the company can only issue new shares at a fixed price of $100. When the market falls below this level, there are fewer opportunities to support dividend payments.
At the same time, the position of Strategy cannot be called critical. The company has enough cash reserves for about 17 months of payments. Therefore, the question of new bitcoin sales remains debatable for now.
Performance of Strategy Stretch perpetual preferred shares (STRC US). Source: TradingView.
Strategy has a low debt burden, about 8%. But bears still use the situation to their advantage. On paper, the company is now sitting on about $8 billion in unrealized losses from its BTC purchases.
For bulls, the main argument now is not Strategy, but the behavior of long-term holders. On-chain data shows they have become less likely to send coins to exchanges. This reduces selling pressure and makes the $60,000 level a more important support zone.
Bitcoin transfers from long-term holders to exchanges. Source: Glassnode.
Over the week, the average volume of transfers from long-term holders to exchanges fell by almost half. Previously, it was about 8,040 BTC per day, now it is about 4,130 BTC.
This is a good signal for the market, but it is not enough on its own. For growth above $65,000 to look sustainable, spot bitcoin ETFs need to show a series of strong inflows. Without this, derivatives traders will likely continue to act cautiously.
For now, the picture is mixed. Pressure from Strategy and weak confidence in the derivatives market are still helping the bears. But reduced selling from long-term holders and a reversal of ETF flows give bulls a chance to get back in the game.
