Bitcoin (BTC) saw a decline of 1.61% on Wednesday, June 26, partially reversing a 2.52% gain from the previous day, ending the session at $60,854. The drop came amid uncertainty regarding the Federal Reserve’s interest rate trajectory, which affected buyer demand for BTC and the broader cryptocurrency market.
The CME FedWatch Tool indicated an increase in the probability of the Fed holding interest rates unchanged, rising from 33.3% to 37.2%. This shift occurred as the US dollar regained strength, with investors closely watching US inflation numbers set to be released on Friday, June 28.
The upcoming US Personal Income and Outlays Report could significantly influence investor expectations regarding a potential rate cut by the Fed in September. Higher-than-expected inflation numbers would reduce the likelihood of a Q3 2024 rate cut, impacting demand for riskier assets like BTC.
Economists forecast a 2.6% year-on-year rise in the US Core PCE Price Index for May, following a 2.8% increase in April. Persistent inflation could continue to pressure crypto markets, as seen when BTC fell 1.27% on May 31.
Despite the mid-week downturn, the US BTC-spot ETF market showed modest net inflows, signaling potential investor optimism.
US BTC-Spot ETF Market Sees Renewed Interest
On Tuesday, the US BTC-spot ETF market experienced net inflows of $31 million, ending a seven-day streak of outflows totaling $1,134.7 million. Wednesday’s data indicated a continuation of this positive trend, with significant contributions from various funds:
Grayscale Bitcoin Trust (GBTC): $4.3 million in net inflows, the first since June 5.
Fidelity Wise Origin Bitcoin Fund (FBTC): $18.6 million in net inflows, down from $48.8 million on Tuesday.
VanEck Bitcoin Trust (HODL): $3.4 million in net inflows, following $3.5 million on Tuesday.
ARK 21Shares Bitcoin ETF (ARKB): $4.9 million in net outflows, extending its streak to four sessions.
Excluding iShares Bitcoin Trust (IBIT) data, the market saw $21.4 million in net inflows on Wednesday. Despite this, June’s total inflows of $560.3 million remain significantly lower than May’s $2,095.5 million.
The BTC price trends reflect this decreased demand, with BTC down 9.52% to $61,089 in June. Meanwhile, developments in the US ETH-spot ETF market also warrant attention.
Will US ETH-Spot ETFs Launch on July 2?
Bloomberg Intelligence Senior ETF Analyst Eric Balchunas recently noted that the SEC could approve ether ETFs by July 4. This follows SEC Chair Gary Gensler’s positive remarks about the progress towards an ETH-spot ETF market. Despite this, ETH declined by 0.77% on Wednesday, ending at $3,370.
Technical Analysis
Bitcoin (BTC):
BTC is below the 50-day EMA but above the 200-day EMA, indicating bearish short-term but bullish long-term trends.
Breaking above the $64,000 resistance could push BTC towards the $69,000 mark.
A drop below the $60,365 support level could lead to further declines, targeting the 200-day EMA.
Ethereum (ETH):
ETH is also below the 50-day EMA but above the 200-day EMA.
Moving above the $3,480 resistance and the 50-day EMA could propel ETH towards $3,600.
Falling below the $3,244 support level could signal a drop towards the 200-day EMA and $3,033.