Bitcoin Price Continues Decline Due to ETF Outflow and Fed Chairman's Negative Comments
Just 2 days ahead of the Bitcoin Halving 2024 milestone, BTC continues to bleed amid a less optimistic market outlook due to comments from the Fed Chairman and dominant outflows from ETFs.
Top Cryptocurrency Movements as of 12:20 PM on April 18, 2024
The cryptocurrency market remains in a painful "bleeding" phase as Bitcoin's price continues to decline. With the Halving event approaching in approximately 2 days - around 11:00 AM on April 20, Vietnam time - the flagship coin has dipped below $60,000 USD.
Around 11:00 PM late on April 17 (Vietnam time), the BTC/USDT pair on Binance saw a flash dump to $59,700 USD, followed by a tepid recovery to around $61,600 USD at the time of reporting.
1-hour chart of BTC/USDT pair on Binance as of 12:20 PM on April 18, 2024
Ethereum (ETH) has faced a similar fate, dropping sharply to nearly $2,900 USD before edging up to around $3,000 USD.
1-hour chart of ETH/USDT pair on Binance as of 12:20 PM on April 18, 2024
This volatility comes in response to recent remarks by Fed Chairman Jerome Powell, who stated yesterday evening that interest rates may not decrease in the near future.
This statement contrasts with expectations that the Fed would cut rates 2-3 times in 2024, with the first expected in June or July.
However, Powell's latest comments have clouded this outlook once again:
"At this point, with the strength of the labor market and inflation trends to date, the Fed sees merit in allowing restrictive policies more time to take effect and for data and outlook to guide us."
Another contributing factor is the outflow from Bitcoin spot ETFs. If Bitcoin's previous upward momentum was largely driven by inflows into ETFs, current outflows are now pushing BTC prices lower.
According to the aggregate data from Farside Investors, trading on April 17 (local time) saw a net outflow of $165 million USD. Notably, Grayscale recorded an outflow of $133.1 million USD.
Source: Farside Investors
Of particular interest is the first-time outflow from another ETF, BITB by Bitwise, amounting to -$7.3 million USD.
Out of the 11 ETFs trading, only BlackRock registered a positive inflow of $18.1 million USD. However, this figure pales in comparison to the dominant outflows seen in other funds.
Long positions continue to be liquidated amidst the weakening market. Over the past 24 hours, there has been a total of $230 million USD worth of liquidated orders, with 74% of these being long positions.
Recent statistics on cryptocurrency market liquidations within the last 24 hours, screenshot taken from CoinGlass at 12:20 PM on April 18, 2024
