Bitcoin has recently experienced a downturn, with its price hitting $111,000, raising concerns of a potential slide towards the $90,000 mark. A noticeable drop in demand for spot Bitcoin exchange-traded funds (ETFs) has intensified the bearish sentiment within the market.
According to Glassnode’s latest Weekly Market Impulse report, ETF inflows dropped significantly last week. From a peak of $2.03 billion, net inflows plummeted 54% to $931.4 million. This stark reduction points to a weakening interest from institutional investors, which was previously robust during the early part of September. Back then, Bitcoin saw a price surge of nearly 10%, driving ETF inflows to over $2.9 billion within an eight-day trading period.
Despite overall accumulation seemingly intact, analysts have noted that the recent slowdown in ETF activity indicates a pause in institutional demand. This decline is particularly striking given that the BTC/USD pair was performing strongly just weeks ago. A Cumulative Volume Delta (CVD) indicator corroborates this, showing a continued selling trend among retail traders since mid-August, further reinforcing a risk-averse trading environment.
Market analysts are increasingly cautious about Bitcoin’s price trajectory. Notably, Michael van de Poppe, founder of MC Capital, stated that should Bitcoin breach the critical support zone of $112,000-$110,000, a drop to the range of $103,000-$100,000 could be anticipated. He emphasized that while there may be short-term pullbacks, he envisions a longer-term bullish sentiment once the current correction phase concludes.
In contrast, fellow analyst AlphaBTC illustrated that Bitcoin is trading within a descending parallel channel on hourly charts. If the support level at $112,000 falters, Bitcoin could potentially slide to approximately $108,000. Analysts have also pinpointed a potential deeper correction toward the $105,000-$100,000 zone if downward momentum persists.
Further compounding these concerns, Bitcoin’s price has dipped below the 0.95 quantile cost basis, currently standing at $115,300. This metric is vital for assessing market risks and indicating possible price action areas. Analysts suggest that reclaiming this cost baseline is crucial for restoring price strength; if not, Bitcoin could drift downwards toward the $105,000–$90,000 support region.
As reported previously, Bitcoin’s formation of a double top pattern casts a shadow over its short-term outlook, with targets nearing the $90,000 mark if the $107,000 support fails to hold.
In summary, the latest data suggests a cautious stance among institutional investors, reflected in declining ETF inflows, which may lead to increased bearish activity and further price corrections for Bitcoin. Traders are advised to keep a close eye on key support levels and market indicators in the coming weeks.
Disclaimer: This article does not constitute financial advice. All investment and trading activities carry risks, and individuals are encouraged to conduct thorough research before making any financial decisions.
