A powerful start to 2024 had the bulls predicting $100,000 bitcoin {{BTC}} at some point this year, but relentless selling pressure during April and June (interrupted by a May bounce) has the price struggling not to drop below $60,000 as the quarter draws to a close.

Entering the second quarter, bitcoin was trading just shy of the $71,000 level and at press time (about 60 hours before Q2 officially closes) was changing hands at $60,800, a decline of more than 14%. Helped by the tailwind of what now appears to be certain spot ETF approval, ether {{ETH}} outperformed, but was still in the red in the second quarter with about a 5% drop.

Dragged down by even larger declines in many altcoins, the broader CoinDesk Index fell more than 21% during the last three months. Among the movers, Solana {{SOL}} tumbled 30%, Ripple's {{XRP}} dropped 23% and Dogecoin {{DOGE}} plunged 42%. The index's best performer was the above-mentioned ether with its 5% slide.

Positive catalysts vanish

Bitcoin's disappointing second quarter price action, for now, can possibly be thought of as a correction within a larger bull move that saw the token rise nearly five-fold from January 2023 lows to a new all-time record above $73,500 in mid-March of this year.

Anticipation of the spot bitcoin ETF approval, then the approval, and then the massive inflows into the new funds were surely major catalysts for the rise. Also in play were macro factors – namely the anticipation of a sizable series of interest rate cuts in 2024 from the U.S. Federal Reserve. Inflation, however, has failed to cooperate, and to date there has been no easing of monetary policy in the U.S., with more than one member of the central bank now not expecting to cut rates even once this year.

With ETF inflows old news and even on occasion reversing to outflows, and hopes for lower interest rates diminishing daily, buyers appear to have taken to the sidelines until a new catalyst arises.

More pain in store in Q3?

Bitcoin entered a downtrend on June 20, writes Markus Thielen at 10X Research, laying out ten reasons why the price could decline to $55,000 in the near term. Thielen noted that many trend-following funds are looking at the same signals and might be inclined to pile into short positions.

In addition, while some bulls may have been excited that the presidential debate seemed to favor Donald Trump – who has recently come out as notably pro-crypto and pro-bitcoin – Thielen suggested President Biden's poor performance heightened the chance of a replacement Democratic nominee who might end up as a far more formidable opponent in the November election.

Thielen also reminded about seasonality. The third quarter has historically been the weakest one, with an average return of just 5% over the past 13 years. This compares to average returns above 60% in both the second and fourth quarters.