Bitcoin (BTC) has recently seen a slowdown in its price movement, despite recovering above $60,000. This tepid price movement can be attributed to various factors, with one of the main reasons being the reduced demand for the Spot Bitcoin ETFs. These ETFs experienced billions of dollars in net inflows during the first three months of their launch, which led to a significant rally in Bitcoin’s price to a new all-time high in March. However, the demand for these funds has been declining since the beginning of this month.
Research firm Kaiko highlighted in a recent report that net inflows across all ETFs have been steadily decreasing, ultimately affecting Bitcoin’s bullish momentum. As a result, the flagship cryptocurrency has been trading sideways, hovering around the $67,000 price range. Andrey Stoychev, Head of Prime Brokerage at Nexo, had previously warned that Bitcoin would struggle to experience a significant price surge without a catalyst, indicating that the crypto token may continue to bounce off support and resistance levels in the near term.
Despite the current stagnation in Bitcoin’s price, there is hope that the demand for Spot Bitcoin ETFs could pick up soon. If these funds see a trend reversal, it could provide a much-needed boost to Bitcoin’s price. Recent data showing Grayscale’s GBTC recording net inflows on May 3 suggests that a turnaround in ETF demand may be on the horizon. Additionally, crypto analyst Mikybull Crypto predicts that Bitcoin could drop below to clear the CME gap at around $62,580, potentially paving the way for a price pickup.
Mikybull Crypto also suggests that regardless of Bitcoin’s current sideways trading, the crypto token may have hit its local bottom. However, in order to see further upward movement, Bitcoin will likely need to clear the $67,000 price level and consolidate before pushing towards $73,000. Analysts recommend accumulating Bitcoin at its current levels, as the Market Value to Realized Value (MVRV) 90-day ratio indicates that it is still in a “prime buy zone.”
As of the time of writing, Bitcoin is trading at around $63,400, down over 1% in the last 24 hours. Despite struggles to hold above $64,000, there is optimism that positive price movement may be on the horizon. It is important for investors to conduct their own research and due diligence before making any investment decisions, as the cryptocurrency market carries inherent risks.
While Bitcoin may currently be facing challenges in its price recovery, there are indications that a turnaround could be imminent. By closely monitoring factors such as demand for Spot Bitcoin ETFs, price gaps, and key price levels, investors can strategize and position themselves advantageously in the volatile cryptocurrency market.
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