Bitcoin Hits Historic High, Year-to-Date Increase Exceeds 19%

This Wednesday (July 9), the price of Bitcoin (BTC) once again broke records, reaching a peak of $112,000, surpassing its previous all-time high of $111,891 set in May. Other major altcoins also performed strongly, with Ethereum (ETH) increasing by 6.66% in the past 24 hours as of Thursday at 5:40 PM, and Solana (SOL) rising by 3.72%.

So far this year, the year-to-date returns for Bitcoin, Ethereum, and Solana are 19.27%, -16.81%, and -17.75%, respectively.

Data from the crypto data platform CoinGlass shows that over $280 million in short positions were liquidated within an hour before Bitcoin surged to its new high, driving the price of Bitcoin to rise rapidly.

Prior to this, Bitcoin's price had been fluctuating between $106,000 and $110,000 for several weeks due to investor concerns over trade tariffs, the Federal Reserve's ongoing hawkish interest rate policies, and broader macroeconomic uncertainties. The more symbolically significant $120,000 level had also been attempted multiple times without success, putting considerable pressure on bulls.

So, with Bitcoin breaking through the $110,000 mark again this week, is it a short-term trap for bulls, or is it building momentum for a push towards the $120,000 milestone?

Geopolitical Concerns Diminish, Institutional Inflows and Rate Cut Expectations Boost Bitcoin

Previously, geopolitical crises in the Middle East had raised market concerns, but recently, the crypto market seems to have shaken off these influences, with market focus returning to the positive factors that have continued to support Bitcoin's rise this year: ongoing institutional and corporate inflows, favorable regulations, and the prospect of Federal Reserve rate cuts.

Regarding the Federal Reserve, U.S. President Trump has repeatedly expressed dissatisfaction with current Fed Chair Powell. There are expectations that Trump may announce the new Fed chair candidate earlier than the previously speculated May 2026, possibly as soon as September or October this year.

It is evident that Trump favors nominating a candidate who supports aggressive rate cuts to align with his economic policy direction. Once established, the new Federal Reserve leadership will also accelerate the pace of rate cuts, providing new upward space for risk assets like Bitcoin.

Meanwhile, although Powell pointed out in previous congressional testimony that Trump's tariff policies could raise inflation, he also emphasized that if there are no clear signs of high inflation, the Federal Reserve will continue to pursue rate cuts. This statement was interpreted by the market as dovish, further boosting optimism about future rate cuts.

Next Week Welcomes "Crypto Week," Analysts Bet on Bitcoin Hitting $120,000

Strahinja Savic, head of data analysis at crypto financial advisory firm FRNT Financial, noted in a media discussion that as more investors view Bitcoin as an important tool for hedging against fiat currency uncertainty, multiple positive factors are driving Bitcoin's upward trend.

"For supporters of Bitcoin, the current global situation is precisely the reason they bought this asset in the first place. In the U.S., people are gradually realizing that the country's fiscal situation is unsustainable, and there is a lack of sufficient reform capability."

Ryan Gorman, Chief Strategy Officer at Uranium Digital, also believes: "With Washington set to welcome 'Crypto Week' next week and entering the summer trading lull, the market is expected to see a wave of positive momentum, pushing Bitcoin's price to challenge $120,000 or even higher by the end of next week. Although the summer market trend is still difficult to predict, the options market shows a significant number of bullish contracts compared to bearish ones, indicating that traders remain optimistic about future price increases."

Strahinja Savic from FRNT Financial stated: "Outside the U.S., there is also considerable geopolitical and macroeconomic uncertainty, from the Russia-Ukraine conflict to tensions in the Middle East, all of which are intensifying market risk aversion. In this context, a scarce, peer-to-peer digital asset that is not controlled by any single country naturally resonates with investors. We are seeing Bitcoin's price aligning with its increasingly prominent status as a global safe-haven asset."

Currently, the crypto market sentiment index is in the "neutral" range, with a reading of only 54. Historical experience shows that when Bitcoin peaks and the crypto market sentiment is in the "greed" range, the market is likely to experience a pullback or short pause in most cases, allowing professional investors to take profits under overbought conditions.

Although many analysts are generally bullish, from the perspective of actual buying operations, current traders are cautious about buying Bitcoin at the current price level, as the cryptocurrency has yet to effectively break through the historical high of $111,970.

Bitfinex analysts wrote in their latest report: "Bulls appear hesitant or unable to push prices further up in the absence of new catalysts or clearer macro signals."

Additionally, data from blockchain analytics platform Santiment shows that Bitcoin's social media sentiment has reached a three-week high, with bullish comments outnumbering bearish ones by 1.51 times. However, analysts from the platform warn that similar surges in sentiment have led to price pullbacks on June 11 and July 7.

Moreover, although institutional investors generally recognize Bitcoin's attributes as "digital gold," Bitcoin essentially remains a risk asset, and its price fluctuations are often closely related to stock market risk appetite.

Summary:

Bitcoin has strongly refreshed its historical high, with institutions continuously increasing their positions, favorable policy expectations, and the agenda of "Crypto Week" collectively igniting market sentiment. Analysts are generally optimistic about a short-term challenge to $120,000. However, sentiment indicators show that the market is approaching an overheated range, and past experiences remind us that without new catalysts, there may be short-term pullbacks triggered by profit-taking, so investors should remain cautious.

Related: Bitcoin (BTC) investors have now invested over $50 billion in U.S. spot ETFs.

Original article: “Bulls Are Smiling, Bears Are Blown Away! Bitcoin (BTC) Faces the Crucial Test of Breaking $120,000”

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