Personal demand for Bitcoin is at its lowest level in 5 months

Average demand for Bitcoin among retail investors has reached a five-month low, falling to levels seen in January. There was a 75% increase over two months.

Historical context and market reaction

According to the data shared by CryptoQuant author Axel Adler on the

Adler:

“When a similar decline fell to 18% in January, BitcoinIt rose from $40,000 to $70,000, pushing Bitcoin to its all-time high of $73,679 in mid-March when spot Bitcoin exchange-traded funds (ETFs) were approved in the United States.

“I also observed that this cluster reacts quickly to any random change in the market.”

Adler last month showed demand fell 31% in the 17 days to May 24, falling to negative 14.50%. Using the head-to-head metric, GameStop ( GME) And to etherthat there has been an increase in interest in etherHe stated that this was in response to the first approval of his ETFs.

Impact of CPI on Bitcoin demand

Analysts have suggested that the change in Bitcoin demand can be attributed to various factors, such as the US Consumer Price Index (CPI).

As traditional savings and term deposits provide less profitable returns as interest rates fall of the CPIA decline could make riskier assets such as Bitcoin more attractive to investors.

10x Research Chief Researcher Markus Thielen stated that in order for Bitcoin to reach new record levels, CPI must fall below 3.3% according to the data to be announced on June 12.

Latest market movements

On June 11, Bitcoin fell below its November 2021 all-time high of $69,000; This is a level that investors are watching carefully. According to CoinMarketCap, Bitcoin is currently trading at $67,350 and is down 3.19% in the last 24 hours.

The sudden drop wiped out $52.87 million worth of Bitcoin long positions yesterday. According to CoinGlass data, Open Interest (OI) remained above the frequently monitored level of $ 35 billion.

Investor sentiment and future outlook

While investors expected Bitcoin to quickly rise above $70,000 following the drop on June 8, it has now failed to do so.

With CPI data to be announced on June 12 and short positions of $2.14 billion, futures investors do not seem to expect a recovery in the near term.

This news was first published on the Coin Engineer website.