Bitcoin’s price has faced downward pressure recently, with macroeconomic factors contributing to the flagship crypto’s struggles. However, Bitcoin’s price has remained resilient, thanks in part to the steady growth of exchange-traded funds (ETFs).
These funds have proven crucial in supporting Bitcoin’s price, offering optimism for a potential breakout in the coming months.
Bitcoin ETFs Show Investors’ Real Outlook
Despite the general bearish sentiment in the market, Bitcoin ETFs have seen consistent inflows. Over the past few months, these ETFs have experienced only three instances of outflows, even amid challenges such as the Israel-Iran conflict. In July, Bitcoin ETFs saw inflows of $4.5 billion, pushing cumulative flows to $48.95 billion.
Bitcoin Spot ETF Inflows. Source: Coinglass
This shows that institutional investors continue to view Bitcoin ETFs as an attractive option. However, speaking to BeInCrypto, Mete Al, co-founder of ICB Labs, stated that Bitcoin has yet to completely decouple from the stock markets.
“There’s still room for it to separate further from the stock market. Spot ETFs are acting to link Bitcoin to Wall St., but in risk-off moments, like the Israel-Iran flare-up, crypto has not remained in correlation to the S&P. Translation: decoupling isn’t dead just expect it to be episodic, not permanent,” Mete noted.
Bitcoin’s macro momentum is supported by its safe haven zone, which is situated between $100,000 and $103,000. Recent data from the IOMAP shows that between $100,668 and $103,876, investors bought a significant amount of Bitcoin, approximately 574,170 BTC worth over $61.41 billion.
Bitcoin IOMAP. Source: IntoTheBlock
Despite the recent downturns, Bitcoin has consistently bounced back in this range, providing a sense of stability. While the demand zone above this price range exists, it has yet to show strong enough support to prevent further drawdowns.
This demand zone suggests that Bitcoin is likely to hold its ground above the $100,000 mark, and Mete AI shares a similar outlook.
“It appears that this supply zone will last a bit longer. There’s a fat layer of limit bids and in-the-money call options parked in this range. Unless headlines knock the price under $100,000 on a closing basis, dip buyers should keep that floor intact,” Mete told BeInCrypto.
BTC Price Breakout May Take Some Time
Currently, Bitcoin is trading at $107,075, having struggled to secure the $108,000 level as support. This reinforces the formation of a descending wedge, a pattern that has strengthened over the past month. The failure to maintain $108,000 indicates the ongoing downward pressure Bitcoin is facing in the market.
Bitcoin Price Analysis. Source: TradingView
Historically, July has been a positive month for Bitcoin, with a median monthly return of 8.09%. This suggests that despite the current downward trend, Bitcoin could experience a resurgence in July. However, this may come with another swing low, potentially falling below $101,000, which could set the stage for a breakout and push Bitcoin towards $110,000.
Bitcoin Monthly Returns. Source: Cryptorank
That said, it’s crucial to consider the worst-case scenario. If the broader market faces a crash, Bitcoin could fall below $105,000 and even hit $100,000. Losing support at these levels would invalidate the bullish scenario, signaling that Bitcoin may continue to struggle.
