Spot ETFs continue to suffer losses

[Ben Graham]

Bitcoin and other altcoins saw a slight recovery yesterday after a significant sell-off, but it is unlikely that this correction can be considered the end of the bear market. Data from SoSoValue supports this assertion.

According to the report, outflows from spot BTC and ETH ETFs have continued for six consecutive days. This indicates that institutional investors, who typically have a longer investment horizon, are exercising caution or even locking in profits, thereby putting pressure on the market. Nonetheless, yesterday, Trump offered a glimmer of hope for a rebound by stating that cryptocurrencies are relieving pressure on the dollar and that the stock market will rise again soon. This statement, although not directly related to cryptocurrencies, nonetheless instills optimism among some investors.

The optimism, based on the correlation between the stock market and cryptocurrencies—which does not always manifest—could provoke a temporary upward bounce, which is what we are currently witnessing. However, sustainable growth requires more fundamental factors, such as declining inflation, a loosening of monetary policy by the Fed, and positive regulatory news. Additionally, a return of inflows into spot ETFs is necessary, as they have recently been the driving force behind market growth.

Regarding Trump's statements, the weakening pressure on the dollar could potentially pave the way for alternative economic models, stimulating innovation and competition. According to Trump, cryptocurrencies could help strengthen the existing financial system by minimizing risks and maximizing benefits.

Trading recommendations:

As for the technical picture for Bitcoin, buyers are currently targeting a return to the $105,300 level, which opens a direct path to $108,800, and from there it is only a short step to $111,300. The furthest target is the maximum around $113,500; surpassing this level would signify attempts at a return to a bull market. In the event of a decline, buyers are expected at the $102,400 level. A move below this area could quickly push BTC down to around $99,400, with the furthest target at $95,800.

For Ethereum, clear consolidation above the $3,505 level opens the way to $3,664. The furthest target is around $3,818; breaking past this level would indicate a strengthening bull market and increased buyer interest. If Ethereum were to decline, buyers are anticipated at the $3,327 level. A drop below this area could quickly bring ETH down to around $3,139, with the most distant support at $2,950.

What we see on the chart:

- Red lines indicate support and resistance levels where either a price slowdown or active growth is expected;

- Green lines represent the 50-day moving average;

- Blue lines indicate the 100-day moving average;

- Light green lines show the 200-day moving average.

Generally, a crossover or price test of these moving averages typically halts market momentum or sets a new directional impulse.

The material has been provided by InstaForex Company - www.instaforex.com