News Headlines
- South Korea Central Bank rules out bitcoin reserve possibility.
- Deutsche Borse Group to launch Bitcoin custody service in April 2025.
- US Bitcoin ETFs erase year to date gains.
- Gold ETFs inflow takes over Bitcoin ETFs amid historic rally.
- ANALYSIS: This rare Bitcoin buy signal could ignite next BTC rally.
Price Action
After last week's price drop, Bitcoin has tried to recover. It has bounced from the lows of $76,000 and tried to reclaim the 200-day moving average. So far, it has been unable to do so, but each time that resistance level is tested, it will become weaker.
This week's challenge for the bulls is to reclaim the 200-day moving average and aim for the 128-day moving average, currently at $95,000. Price rejected right off the 128-day moving average on the 3rd March, which set the tumble down to last week's lows.
Figure 1: Bitcoin trying to reclaim its 200-day moving average.
Support remains the 1yr moving average below which has historically acted as final support in a Bitcoin bull market. That level is currently at $75,000.
Bitcoin has retraced 30% from its high back in January this year. This level of drawdown is typical in Bitcoin bull markets.
Right now $BTC is 23% down from its highs.
Figure 2: $BTC has pulled back 30% from its highs.
The Big Story: US ETFs erase year-to-date gains
The recent downward price action has not only impacted traders but also appears to have spooked ETF allocators, whether individuals using ETFs as an easy way to gain exposure to bitcoin or institutions.
Many Bitcoin ETFs have seen their year-to-date inflows erased by the major outflows from February and March.
While some suggest that this is due to waning demand in Bitcoin ETFs as asset managers look to launch other crypto ETFs, the greater likelihood is that there has simply been a lot of short term panic selling as prices have tumbled.
When we map the BTC price (black line on the chart below) on top of the daily ETF flows, there is a clear correlation between the downward price action and net outflows, which are represented by the red bars on the chart.
Figure 3: Bitcoin ETF Daily Flows (USD).
BlackRock’s IBIT fund is the major player in the Bitcoin ETF world. It has historically had very little outflows. However, in the recent price drop, even IBIT has shown several days of negative outflows, which will have contributed to the market panic as price dropped into the $76,000 region last week.
Figure 4: BlackRock IBIT inflows/Outflows
As the $BTC price has settled around the 200-day moving average, IBIT’s outflows are now reducing with flows reverting to a more neutral level recently.
BlackRock’s IBIT makes up a significant proportion of total ETF flows. It is the yellow section on the chart below which shows combined ETF Flows over time.
Figure 5: Bitcoin ETF Cumulative Flows (USD)
There are two interesting points to note from this data: first, the sheer size of BlackRock's IBIT relative to the rest of the market, and second, how small IBIT’s recent outflows have been relative to the total inflows it has generated over time.
This suggests that the recent outflows should not be concerning. If $BTC can turn around from here, we expect to see positive inflows return to the ETF market very soon.
Live Chart Review: Bitcoin Cycle Master
Figure 5: Bitcoin Cycle Master
What it is
Bitcoin Cycle Master combines on-chain metrics, including Coin Value Days Destroyed and Terminal Price, to identify where Bitcoin's price is valued relative to its cycle peaks and lows.
How it is useful for Bitcoin investors
Bitcoin Cycle Master can identify periods of increased risk when on-chain transaction behavior indicates major cycle highs are approaching. It also identifies areas of value opportunity where on-chain transaction behavior signals major cycle lows.
What it is showing now
After reaching the ‘Aggressively Valued’ upper orange band in January, $BTC has retraced back to its ‘Fair Value' purple band.
The red ‘Over Valued’ band, which $BTC price has reached in each of its previous bull market peaks, is currently at $204,405 and climbing.
Alerts for this indicator are available to Bitcoin Magazine Pro platform subscribers. Want to subscribe? Join us here.
The Bitcoin Magazine Pro Team.