Bitcoin (BTC) continues to tread water below the $30,000 line, dragging down a host of altcoins with it as Dogecoin (DOGE), Solana (SOL) and Polygon (MATIC) all fell by 6-7% midweek. The malaise remains in place even as data shows an uptick in BTC accumulation because the market has yet to make any major moves. So the question is, what is the next trigger that could spark some action in this stagnant market? Let's analyse a few factors.

The SEC reviews Bitcoin ETFs

The US Securities and Exchange Commission (SEC) is still stalling on a review of multiple spot BTC ETF applications, including one from finance titan BlackRock. Plenty of crypto pundits are bullish on Bitcoin's prospects if these ETFs are approved. Fundstrat Global Advisors' Tom Lee dropped a characteristically bombastic prediction of $180,000 during a CNBC appearance this week. While this prediction should be taken with a pinch of salt, more analysts expect that the SEC's approval of spot BTC ETFs would drive up demand for Bitcoin and increase prices.

Investor sentiment 

Looking at the futures market, we can see that the trend of short Bitcoin liquidations that had dominated since the start of the year has now reversed. Now, 83% of all BTC liquidations are long positions, and Bitcoin trading volume sits at its lowest level in over two years. Without any buying pressure from trading volume, the dominance of long liquidations is keeping asset prices down.

Macroeconomic events

Bitcoin traders have been keeping an eye on the global economy lately as BTC's price continues to be directly affected by inflation, as indicated by the consumer price index (CPI) figures and the actions of the US Federal Reserve. Last week's CPI surprised analysts by being lower than usual, suggesting that the Fed may slow its interest rate hikes and even start cutting rates to stimulate the economy. If this occurs, then Bitcoin and the wider crypto market could benefit from renewed investor interest.

Despite the mid-August slump and overall low volatility, general market sentiment still expects a recovery and breakout for Bitcoin as mainstream financial institutions continue to adopt crypto and the 2024 halving event looms on the horizon.

StormGain Analytical Group 
(platform for trading, exchanging and storing cryptocurrency)