In line with the decline in Bitcoin’s price, the Bitcoin ETF spot market has looked quite gloomy in recent days. According to data from analytics company BitMEX Researchthese BTC ETFs have recorded negative net flows over the last four trading sessions.
This situation was characterized by large outflows for Grayscale’s GBTC and record low inflows for the other ETFs, especially market leaders BlackRock’s IBIT and Fidelity’s FBTC. However, amid these continued declining net flows, Ki Young Ju, a leading analyst and Chief Executive Officer at Cryptoquant, has predicted a possible revival of the spot Bitcoin ETF market.
Analyst Pinpoints $56,000 Level as Crucial for Bitcoin ETF Recovery
In a after at Using data from historical net flow trends, the analyst noted that demand for Bitcoin ETFs usually begins when the cryptocurrency reaches a certain support level.
Young Ju stated that new BTC whales, especially ETF buyers, have an on-chain cost basis of $56,000. This suggests that Bitcoin’s new major holders, especially those invested in ETFs, typically bought Bitcoin at an average price of $56,000. Following this trend, the crypto quant boss believes that the Bitcoin ETF spot market could experience massive inflows if BTC were to reach the specified price level.
#Bitcoin The net flow of spot ETFs is slowing.
Demand may recover if the $BTC price is approaching critical support levels.
New whales, mainly ETF buyers, have an on-chain cost basis of $56K. Corrections typically involve a maximum decline of around 30% in bull markets, with a maximum pain of $51,000. pic.twitter.com/vZCG4F0Gh5
— Ki Jonge Ju (@ki_young_ju) March 22, 2024
For now, Bitcoin’s price is fluctuating between $62,000 and $68,000, as seen over the past week. However, Young Ju believes that such a drop is very possible as price corrections typically show a maximum drop of 30%. Based on BTC’s most recent high of $73,750, the analyst predicts that the asset price could still be as low as $51,000.
BTC price overview
At the time of writing, Bitcoin continues to trade at $64,065.74, representing a decline of 3.73% and 7.17% over the past seven days. Meanwhile, the asset’s daily trading volume is down 3.53% and is valued at $39.62 billion.
Following the historical trends of the bull cycle, it is possible that BTC has reached its price peak leading up to the April halving. If that is the case, Bitcoin is unlikely to return to its previous high price level anytime soon and could experience further price declines in the coming weeks.
BTC trading at $64,315.00 on the hourly chart | Source: BTCUSDT chart on Tradingview
Featured image from Euronews, chart from Tradingview
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