Bitcoin enters July at a precarious juncture following a nearly 20% decline in June, which pushed the price below $58,000 and closed beneath the 200-week moving average for the first time since 2022. While historical patterns offer a glimmer of hope—BTC has posted positive July returns in nine of the last thirteen years, including a 24% surge in 2020—current on-chain metrics paint a starkly different picture.
Popular analyst Axel Adler Jr. warns that conditions are worse than during February’s correction. Bitcoin inflows to exchanges have spiked to 122,000 BTC, far exceeding the annual average of 82,000 BTC, signaling mounting selling pressure. The Spent Output Profit Ratio (SOPR) has slipped to 0.99, below the critical 1.0 threshold, indicating that investors are now selling at a loss. Adler argues that for a recovery to take hold, SOPR must rise above 1.0 and exchange inflows must stabilize.
The options market echoes this bearish sentiment. Data from Paradigm shows that put options—bets on lower prices—are pricier than calls across all expiries, with a notable uptick in demand for $50,000 strike puts expiring in September. Analysts say this positioning reflects growing conviction that BTC could test $50,000 by the end of the third quarter.
Yet beneath the surface, long-term holders have begun accumulating again, according to Glassnode. Spot order books on Binance and Coinbase are leaning toward buy orders, hinting at a shift from distribution to accumulation at sub-$60,000 levels. However, Glassnode cautions that high fear readings, elevated demand for put options, and the buildup of leveraged long positions still pose risks of further long liquidations. The analysts note that another sharp drop may be necessary before a definitive market bottom is formed.
