Bitcoin is stuck near $64,000 as ETF outflows reach a sixth week
Bitcoin is currently trading around $64,000, according to CoinDesk pricing data, as it continues to search for a catalyst to break out of the range it has been stuck in for weeks. Although selling from spot bitcoin ETFs has slowed down compared to earlier this month, there has been a lack of fresh institutional demand.
Data shows that U.S. spot bitcoin ETFs have experienced net outflows for the sixth consecutive week, with only a few days of positive inflows. While the outflow has decreased, the absence of sustained inflows indicates that institutions are still cautious as they evaluate the Federal Reserve’s interest rate trajectory.
One significant factor weighing on bitcoin is the strengthening dollar. Following the June meeting, the Fed’s conservative stance on rate cuts has boosted the Dollar Index to the 100.6-100.8 range, leading to higher Treasury yields. In a market environment with tight liquidity, investors tend to favor assets with more stable yields over volatile ones like bitcoin.
Despite a temporary boost in risk appetite due to easing geopolitical tensions following the U.S.-Iran deal, this has not been enough to counteract the impact of the stronger dollar and cautious investor sentiment. As a result, bitcoin is expected to remain within a range of $60,000 to $67,000 in the near term, according to Simon-Peter Massabni, head of business development at XS.com.
Massabni believes that the market is currently balanced between supportive and restrictive forces, with factors such as reduced ETF selling and improved sentiment on one side, and a less supportive Fed and uncertain institutional flows on the other. For a sustainable recovery in the second half of the year, it will require more time for accumulation, a resurgence in ETF inflows, and increased institutional demand.
Until these conditions are met, any price rebounds in bitcoin are likely to be technical in nature rather than the beginning of a new uptrend. Investors should monitor these key factors closely to gauge the potential direction of bitcoin’s price movement in the coming months.
