After a significant surge during “U.S. Crypto Week,” Matrixport is forecasting a “summer consolidation” period for the cryptocurrency market, expected to last until August.
The recent rally in Bitcoin appears to be losing momentum, as Matrixport anticipates a period of consolidation through August following “Crypto Week.”
Matrixport reported on July 25 that Bitcoin had attained a technical ceiling of $122,000, following a breakout that lacked sustained leverage support earlier in the month. The report was shared on social media.
Anticlimatic Market Post Crypto Week
Even though retail activity increased during the U.S. “Crypto Week,” analysts observed a lack of follow-through.
In its previous note dated July 18, the company characterized the move as “poised to cool,” preceded by a 0.6% weekly decline.
The open interest in Ethereum futures experienced a significant increase from $14 billion to $25 billion, even though funding rates remained relatively consistent. Matrixport anticipates these rates will decrease in the upcoming weeks, resulting in the unwinding of positions.
The report also reported that the market is transitioning to a slowing summer cycle, which is characterized by a rise in profit-taking pressure from early holders and a shift toward risk reduction.
Matrixport observed that the confidence of long-position holders is currently contingent upon the continuation of upward price movement. With increased carry costs, leveraged transactions may be unwound without it.
Industry Enters “Quieter Summer”
Missing the original 180-day deadline of July 22, the White House’s anticipated Bitcoin reserve strategy report has been postponed to July 30. Matrixport does not anticipate any significant new policy direction from the document, which implies that the GENIUS Act has become the primary focus of attention on stablecoin-backed Treasury demand.
“We anticipate an increase in position squaring (unwinding) as we transition into the quieter summer period and approach the seasonal recess,” the report stated. “The conclusion of U.S. Crypto Week signifies a climax in market momentum.”
The company believes that the current market phase is technically overbought and anticipates that there will be limited upside in the absence of new catalysts.
Additionally, the utilization of technical overlays and macro signals in digital asset trading strategies is on the rise due to the increasing complexity of the market. Positioning decisions increasingly depend on broader monetary dynamics, such as real yields, funding spreads, and cross-asset correlations.
In the future, short-term rate expectations may have a more significant impact on the movement of digital assets, as the GENIUS Act, which links stablecoin issuance to U.S. Treasuries, has been implemented.
