Bitcoin briefly climbed above $73,000 on July 5, reviving market momentum after months of weakness and choppy trading. The rebound has reopened a familiar debate: is this the start of a fresh bull run, or a short-lived rally that pulls in buyers before a reversal?
In a report released Wednesday, Clear Street analyst Owen Lau said the crypto market suffered a steep 44% drawdown from Oct. 10 last year through Feb. 28 this year, and argued that the selloff now appears to be nearing its end. He did not provide a specific Bitcoin price target, but said both sentiment and fundamentals have improved noticeably over the past several weeks.
Regulation, TradFi links and institutional demand in focus
Lau pointed to several developments behind the recovery. He said the regulatory outlook in Washington has become clearer, ties between the crypto sector and traditional finance have deepened, and institutional investors have continued to enter the market. Taken together, those factors are helping support the recent move higher.
Policy developments have drawn particular attention. According to the report, President Donald Trump said Tuesday that he would step in to push the stalled Digital Asset Market Clarity Act, or CLARITY Act. Lau said that improves the odds of the bill passing Congress before the end of summer. JPMorgan had previously said the legislation, which would shape market structure for digital assets, could act as a catalyst for the next leg of the market.
There was also progress on financial infrastructure. A banking subsidiary of crypto exchange Kraken recently obtained a Federal Reserve master account, giving it direct access to the Fed’s payment and settlement system. Lau described that as a major milestone for a crypto-native company entering the US financial system. Separately, Morgan Stanley updated its spot Bitcoin ETF filing to add Coinbase Custody as a co-custodian alongside BNY Mellon, a sign that institutional involvement is still expanding.
Strong weekly gains meet resistance near $75,000
Bitcoin has risen about 11% over the past week, with its single-day gain at one point reaching 8%, as tensions in the Middle East intensified. That sharp advance pushed the asset close to the widely watched $75,000 resistance zone and sharpened the disagreement between bullish and bearish camps.
Supporters of the rally argue that the market looks healthier after a period of shakeout and capital rotation. Lau currently rates Coinbase and Bullish as Buy, while maintaining a Hold rating on stablecoin issuer Circle, reflecting a constructive view on the sector’s recovery.
Not everyone is convinced. Some traders warn that the surge could amount to a bull trap, with a breakout drawing in momentum buyers before a sharp decline. Bearish analysts have pointed to overhead supply from trapped holders and to positioning in derivatives markets as possible sources of pressure. One view cited in the report says that if Bitcoin trades into the $72,000 to $76,000 range, the market may face large-scale selling from investors looking to exit positions rather than fresh trend-following demand.