Bitcoin ETPs are experiencing huge outflows. They are not unexpected, however, given the collapse in the value of bitcoin last week. Investors have been feeling bearish since the bitcoin price fell below $40,000 yet again. It has also put enormous selling pressures upon other investors who gained market exposure through ETPs and trading investment vehicles.
Bitcoin ETPs Under Attack
Bitcoin ETPs enjoyed an excellent month of inflows before this month. This was because the faith in Bitcoin had been renewed after its recent campaign exceeding $40,000. This month was one of the most successful in ETP history, with over 10,000 BTC recorded in inflow.
But, April’s outflows are almost the same as March’s. And the month isn’t even finished. It is the highest outflow recorded since Bitcoin ETPs were launched. Last July, when outflows reached 13,849 BTC was the last.
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With more than 9871 BTC, April is following closely this trend. This trend may reverse in the last days of April. It is the 2nd-largest ever outflow and has had a direct impact on the investor sell pressure.
ETPs surpass history's record for second largest | Source: Arcane Research
However, it is not as severe a warning sign as people might believe. The July 2021 outflows show that they occurred at the height of summer selling, and were quickly followed by a rebound in digital assets’ prices.
If that is true, this could mark the end to the recent market sell-offs. If bitcoin can bounce from this point, it will likely move towards $55,000.
BTC Charts
The $40,000 support had held the bitcoin price steady for the majority of the week. This point was eventually broken and the bitcoin price dropped below $39,000. The short-term decline would not last as midweek trading brought the digital asset up to $42,000.
BTC begins a new recovery trend| Source: BTCUSD on TradingView.com
The asset is performing well, but it’s still far from $45,000 where bears have mounted some of the most formidable resistance in market history. This was the resistance that had prevented bitcoin from falling in the last week.
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Today’s cryptocurrency trading has seen it trade higher than the 50-day moving median, indicating a bullish trend short term. The cryptocurrency would trade above the 50-day moving average, indicating a bullish trend over the long term. It could then travel all the way up to $48,000 and bear the critical resistance level of $45,000 BTC remains on unstable ground below this level.
Featured image taken from Medium. Also charts from Arcane Research and TradingView.com.