- Bitcoin faced another setback in pursuit of spot ETF approval.
- BTC may lend itself to selling pressure, but it was experiencing an outflow of exchange rates at the time of writing.
Multiple Bitcoin ETF filings in June sparked bullish sentiment in the market. This is because ETFs are a gateway to institutional demand. However, that hope may be short-lived.
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The US regulator SEC previously shot past Bitcoin [BTC] ETF filings and the markets reacted negatively. Recent reports suggest that the recent applications could suffer the same fate. The US regulator has reportedly returned documents submitted by Fidelity and BlackRock, to report that the documents were insufficient and unclear.
The news that the SEC is returning the documents has already had a negative impact on the price in the past 24 hours. Bitcoin briefly fell from over $31,000 to under $30,000. It has since recovered somewhat and changed hands at the time of writing for $30,474.
Source: TradingView
Meanwhile, the MFI indicator shows that Bitcoin is already experiencing some liquidity outflows. The timing is also noteworthy as selling pressure returns at a previously tested resistance level. But is this the start of the next wave of selling pressure, or will the bulls regain control?
Bitcoin is in danger of losing some of its recently acquired liquidity
Bitcoin was already experiencing a slowdown in buying pressure ahead of the SEC news. However, this new challenge in pursuing spot ETFs could erode prevailing confidence, leading to more potential downsides.
Perhaps one of the best ways to look at Bitcoin’s next possible move is to review its recent flows. While the recent findings are bearish, exchange flow data shows an opposite result. The stock market’s inflows have fallen dramatically over the past 24 hours and were below the level of outflows at the time of going to press.
Source: CryptoQuant
One possible reason for these findings is that news about the SEC does not necessarily mean that the ETF applications have been rejected. There is still a significant chance that the regulator will fail and that there will be an appeal at some point.
Read Bitcoin [BTC] Price Forecast 2023-24
On the other hand, investors should still pay attention to the market outcome, especially in the derivatives segment. Bitcoin’s outstanding interest turned on June 27 and has been on a downward trajectory ever since.
Source: CryptoQuant
Similarly, the level of leverage also fell as the market slipped back into a state of uncertainty. The fact that Bitcoin bounced back above $30,000 after the dip is a show of bullish power. It is further supported by the fact that it continues to experience more demand than selling pressure.
