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What’s Next for BTC as Crypto Fund Outflows Reach $600 Million
Digital investment products saw an increase in outflow volume last week, according to a weekly report from CoinShares. The outflows coincided with several macro events, including the release of US CPI data, the FOMC meeting and PPI data. Initially, Bitcoin price reacted with an impressive upward move towards $70,000. However, sellers soon threw cold water on the uptrend, culminating in a correction to $65,000.
Technical structure of Bitcoin price as outflows increase
The weekly report on the status of digital asset investment products indicates growing dissatisfaction among investors, both retail and institutional. With outflows totaling US$600 million, pressure on the market could continue this week.
In the statement accompanying the report, CoinShares said the negative sentiment may have followed “a more aggressive than expected FOMC meeting, prompting investors to reduce their exposure to fixed supply assets.”
Bitcoin faced the most severe impact from the $621 million outflows. Traders reacting to the upcoming scenario injected $1.8 million in inflows, selling Bitcoin short.
Interestingly, a wide selection of altcoins registered entries, Ethereum leading the charge with $13 million. Litecoin, Binance Coin, XRP, Cardano, Chainlink and others saw smaller inflows.
Digital asset flows by asset | CoinShares
While the total cumulative net inflow into Bitcoin ETFs has grown steadily in recent weeks to $15.11 billion, the previous week was not optimistic, with the sector closing at -$190 million total daily net inflow, according to SoSoValor data.
Bitcoin Price it hovered at $65,976 at the time of writing, down 0.5% in 24 hours. The largest digital asset corrected another 5% in a week, bringing the total drop in the last 30 days to 1.7%.
Bitcoin Price Analysis: Navigating the Bearish Scenario
Bitcoin bulls are navigating a very risky crossroads that could lead to a rally to $70,000 or extend the pullback to $60,000. This is the level marked in green on the chart around $65,000. Wiping out support would leave BTC defenseless against a strengthening bearish front.
Such a move would also confirm the bearish outlook for the Moving Average Convergence Divergence (MACD) indicator. For this reason, Bitcoin will remain unstable until a trend is confirmed towards $70,000 or $60,000.
The sell signal will be reinforced by the MACD line in blue, crossing below the signal line in red. Note that the MACD position below the neutral area already hurts the bulls.
Bitcoin Price Chart | Trading view
Bitcoin also holds below all three moving averages (EMAs), starting with the 20-day, 50-day and 200-day. This outlook predisposes BTC to intense selling pressure.
A rebound from support marked in green would signal a return of bulls and increase the chances of Bitcoin reaching $70,000. However, due to the delicate nature of the same support level, a further correction towards $60,000 cannot yet be ruled out.
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