Bitcoin is changing hands at $64,746 at the time of writing. The digital asset is down 0.50 percent over the last day, below the previous price record close of around $79,457 recorded in April. The current price is still below the previously important level of support near $70,572 recorded in May. In isolation this chart looks on the quieter side but it’s just the opposite with the ETFs.
On ten of the last fourteen trading days leading up to yesterday, spot Bitcoin ETFs saw positive net inflows. Just four turned negative, but each of them saw significant departures like with over $424 million on the 13th of July and $225 million yesterday. Total inflows are at about $51.63 billion and this is just shy of a record high of $51.85 billion achieved on this wednesday. Billions of dollars came in, but the largest cryptocurrency price is not aligning with them.
Ten days of strong inflows were not able to push the price
Bitcoin was trading just above $82,000 at the beginning of May. The coin is now trading slightly below $64,700, and that is depicting a more than 20 percent plunge while ETF investors poured billions of dollars into the crypto during that period. On July 6th alone, $265.69 million entered into ETF products, and $226.92 million flowed in this monday, with $203.14 million following this tuesday. However, not even these inflows led to new high price levels being set for Bitcoin.
Then the capital arrived and prices still fell anyway. This generally takes place when sellers are on the move at a speed the ETF desks can’t handle. This suggests that anyone who got in at higher prices may be adding to their selling on any rebound from the asset. Even the green daily flows simply acted to curb the price decline and not alter it.
Bitcoin’s rebound is facing resistance at every step
On the daily chart, Bitcoin can be seen moving up from the lows established in June around the $58,000 to $59,000 mark but we are encountering a number of significant resistance points here. Firstly, the market is once again approaching and testing resistance of $67,255 for the second attempt in what has so far only served up one rejection this week. Above this we have $70,572 and then $79,457 as the next significant upside targets, which all need to be breached to indicate a solid recovery.
In the case for downside, support remains around $59,800, which would put the upside July rally in question were it to be violated; alternatively, a holding of the level supports the rationale behind ETF demand supporting the upside.
As the total net assets for the U.S. Spot Bitcoin ETFs slumped in just three days to $78.82 billion yesterday from the tuesday high of $80.94 billion, losing over $2 billion. This is representing the cumulative net inflows only declined from $51.78 billion to $51.63 billion, hinting that the dip in asset value may have been driven by falling prices as opposed to investors leaving the ETF.
In other words, money was still entering the ETFs, but the value of existing holdings fell faster than new inflows could offset the losses, showing that positive ETF demand alone has not been enough to support Bitcoin’s price.
Bitcoin keeps continuing to face selling pressure above $67,000
In the short-term positioning, things remain largely stable. Bitcoin came in just under 0.5 percent lower with somewhat muted volume and is in a somewhat neutral position with a bit of momentum stuck near the neutral side. However, a larger underlying pressure still remains to be taken notice of, with buyers being stuck from back near $80K back in May.
All these upward movements towards the $67K to $70K price range provide sellers an opportunity to offload their positions and, as a result, add to the supply of Bitcoin. One day of ETF outflows is normal. Another consecutive ETF outflow may bring into question demand as Bitcoin edges towards critical Resistance.
Considering the current situation, it looks like bitcoin is prepping for a move toward $67,000 and then $70,000. The current move seems like a healthy retracement according to the current price action.
