Bitcoin Boredom to Persist Until ETF Withdrawals Show Improvement

U.S. spot Bitcoin ETFs have experienced net outflows of nearly $300 million over the past two days. The price of Bitcoin has managed to surpass the $65,000 mark after briefly dropping to around $64,000. Analysts suggest that Bitcoin is currently trading within a range of $65,500 to $64,000.

The short-term price movement of Bitcoin is expected to remain subdued without significant catalysts. Institutional investors have been consistently selling their Bitcoin ETF shares, with U.S. spot Bitcoin ETFs witnessing net outflows of $298 million in the last two days. Since June 10, Bitcoin funds in the U.S. have seen net outflows totaling $879 million.

Fidelity’s FBTC fund experienced the highest outflow of $175 million, while Grayscale Investments’ GBTC fund saw an outflow of $65 million. Institutional investors withdrew $621 million from Bitcoin ETFs last week following the Federal Reserve’s unexpectedly hawkish stance.

Bitcoin derivatives traders faced $32 million in liquidations in the past 24 hours, with long liquidations accounting for $20 million. These continuous net outflows have impacted investor confidence, leading to a 6% decline in Bitcoin’s price over the past week.

A BRN trading desk note suggested that a potential trend reversal for Bitcoin could occur if ETF inflows surpass outflows. The note also highlighted the positive impact of Trump’s pro-mining stance on the mining sector, with miners depleting their Bitcoin holdings to fund operations or upgrade hardware.

Investors are advised to exercise caution, as a drop below the $64,000 mark could signal the start of an early bear market. Despite rebounding to $65,500, sustained downward movement below key support levels could trigger a larger correction. The need for a catalyst is becoming more urgent as selling pressure persists.

Additionally, miners have been reducing their Bitcoin reserves to support their operations or hardware upgrades. If Bitcoin fails to maintain support levels, it could potentially lead to an early bear market. The article was edited by Stacy Elliott.