Bitcoin Rally Fades at $65,000 as Bearish Signals Persist

Expectations for U.S. Federal Reserve interest-rate cuts and cooling inflation have long been key drivers of cryptocurrency market volatility. Bitcoin briefly rebounded after the latest U.S. inflation data came in softer, but on-chain analytics platform Glassnode identified an unusual warning in investor positioning. The development is significant because long- and short-term investors are selling at the same time, directly testing the rebound's staying power.

Taiwanese financial news outlet Anue reported on July 16 that Bitcoin briefly surged from $61,500 to nearly $65,000 after U.S. inflation data for June came in below expectations. Long-term holders, lacking confidence, sold into the rebound to cut their losses, while short-term holders who bought near the lows aggressively took profits, with daily realized gains exceeding $4 million. The simultaneous selling by both groups created heavy resistance as Bitcoin attempted to break higher.

Bitcoin has traded between $60,000 and $68,000 for nearly five weeks as bulls and bears remain locked in a tug of war. Although institutional investors have resumed buying and spot Bitcoin ETFs are providing support through fund flows, the price has yet to break decisively above resistance. Short-term traders therefore remain wary of a pullback.

The latest price action shows BTC again testing $68,000, but the short-term market structure remains bearish. The 50-day moving average is currently around $68,800 and is viewed as a key threshold for a bullish trend reversal. Failure to hold above it could send the price back toward the $60,000 range. The related reporting provided no names of specific institutions, funding amounts or publication date.

Bitcoin has long been viewed by some investors as inflation-resistant “digital gold,” but its recent performance has more closely resembled that of a volatile risk asset. Its price has moved closely in line with software-stock benchmarks such as the iShares Expanded Tech-Software Sector ETF (IGV), suggesting that selling pressure in U.S. technology shares and private equity markets is spilling into cryptocurrencies.

During U.S. trading on Monday, July 13, Bitcoin briefly rebounded above $65,000, but the rally failed to hold. It retreated to about $65,400 as the broader stock market and software shares declined. Polymarket showed the probability of Bitcoin falling below $55,000 had risen to 72%, reflecting weakening confidence among holders and increased downside risk.