Bitcoin dropped to around $53,600 on July 4, marking its first dip below $54,000 since February 25. The largest cryptocurrency by market value then recovered slightly, trading at approximately $56,750. However, it remains 23% below its all-time high of over $73,000 in March.
This recent decline in Bitcoin’s price coincides with a surge in inflows for Spot Bitcoin ETFs on July 6.
ETF Inflows Surge Amidst Bitcoin Decline
Interestingly, Bitcoin’s recent price drop coincided with a significant increase in inflows for Spot Bitcoin ETFs on July 6. Leading this charge was the Fidelity ETF (FBTC), which saw an impressive $117 million in new investments. Not far behind was the Bitwise Bitcoin ETF (BITB), attracting $30 million.
Bitwise Asset Management’s CEO, Hunter Horsley, noted that his team managed to acquire Bitcoins at exceptionally low costs, which has bolstered investor confidence. In just the first week of July, BITB attracted over $66 million in inflows, increasing its Bitcoin holdings to more than 38,000.
Furthermore, Horsley highlighted the current market fall as a significant buying opportunity for both new and existing investors, highlighting a positive outlook for Bitcoin’s future. This week presents a favorable chance to enter the market for those looking to capitalize on the dip.
While the Grayscale Bitcoin ETF (GBTC) experienced $28 million in outflows, other ETFs demonstrated strong inflows, signaling continued investor interest in capitalizing on Bitcoin’s price dip.
Market Trends and Key Support Levels
Market observers are closely watching key support levels as Bitcoin’s trendlines break down. Recently, Bitcoin faced resistance at $57,000, resulting in a 6.72% decline over the past week. Meanwhile, if Bitcoin’s price closes below its recent low of $54,502, it could drop another 7.3%, reaching its next support level at $52,000.
This bearish outlook is further supported by technical indicators. Both the Relative Strength Index (RSI) and the Awesome Oscillator (AO) on the daily chart are below their neutral thresholds of 50 and zero, respectively, suggesting that bearish momentum could persist and drive Bitcoin’s price lower.
Potential Bullish Signals
On the other hand, if Bitcoin manages to surpass the $57,670 resistance level and forms a higher high on the daily chart, it could signal a shift towards bullish sentiment. This scenario could potentially drive Bitcoin’s price up to the next resistance level at $59,000.
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