Crypto Market Struggles with Bitcoin and Ethereum at Multimonth Lows

The cryptocurrency market is experiencing a rough patch as Bitcoin and Ethereum struggle to regain momentum. Bitcoin fell by 2.89% this week, closing at $61,749 after failing to break through the key resistance zone of $64-65K.

Ethereum has confirmed a weekly death cross for the first time in years, with its 50-week EMA now below its 200-week EMA. Prediction market traders are pricing in a 72.3% chance that ETH hits $1,500 before it sees $3,000 again.

The broader crypto Fear & Greed Index sits at 23, indicating extreme fear among investors. Spot Bitcoin ETFs just ended a 10-day, $2.7 billion outflow streak, with a $221.7 million single-day inflow on July 2.

Historically, periods of extreme fear and volatility in the market have been followed by significant price increases. The next halving event, which will reduce mining rewards by 50%, is roughly 21 months away. This could potentially lead to a pre-halving compression phase, where prices grind lower before the next supply shock.

However, the presence of institutional investors and the increasing adoption of Bitcoin as an asset class may alter the dynamics of this cycle. The charts currently suggest that selling pressure may be approaching exhaustion, but it's unclear whether this will lead to a reversal or further decline.