Bitcoin ‘Banana Zone’ Approaching if These 3 Indicators Shift

Bitcoin might soon enter a euphoric phase termed the “Banana Zone,” leading to significant price surges, but analysts indicate that three critical metrics need to reverse first to achieve a “sustainable recovery.”

Julien Bittel, head of research at Global Macro Investor (GMI), explained in a June 18 post on X, “Basically, it’s The Boring Zone before The Banana Zone.” The Banana Zone, a term coined by GMI founder Raoul Pal, refers to a period of substantial upward price movement.

However, a CryptoQuant analyst, known as IT Tech, emphasizes that a sustainable recovery depends on three crucial indicators changing course.

1. Miner Selling Must Decrease

Bitcoin miner selling needs to reduce, as it has been increasing due to a 55% drop in mining revenue. Since Bitcoin reached its all-time high of $73,679 in March, miners have experienced a significant revenue decline. On March 11, block rewards and transaction fees revenue were approximately $78.89 million daily, but this figure decreased by 56% to $34.26 million by June 12, according to Blockchain.com data.

2. Stablecoin Inflows Need to Increase

The stablecoin market requires more inflows since the absence of new issuances decreases liquidity and impacts price volatility. Data from CryptoQuant shows that the amount of stablecoins held in crypto exchange reserves has dropped by nearly 10% over the past two months, currently standing at $21.96 billion.

3. ETF Outflows Must Reduce

Outflows from spot Bitcoin exchange-traded funds (ETFs) like those from Fidelity and Grayscale Investments need to decrease, as they create selling pressure on Bitcoin. On June 18, Fidelity’s Bitcoin Wise Origin Bitcoin Fund and Grayscale’s Bitcoin Trust ETF had outflows of $83.1 million and $62.3 million, respectively, according to Farside data.

Market Trends and Future Predictions

Bitcoin is currently trading at $64,966, reflecting a 2.35% decline over the past 30 days and a 12% drop from its March all-time high. IT Tech believes this could signify a “market bottom.”

Altcoins have faced more severe declines in the past week. Major altcoins like Solana (SOL), Dogecoin (DOGE), and Shiba Inu (SHIB) have seen seven-day drops of 8.23%, 11.67%, and 16.31%, respectively.

Julien Bittel noted that Bitcoin’s current lack of price movement indicates a “period of sideways chop.” Other traders expect a directional shift soon. Pseudonymous trader Rekt Capital mentioned on June 18 that breaking the current downtrend line could initiate a price reversal for Bitcoin, which has been in a “constant downtrend” throughout June.