Bitcoin Price Crashes as Weekly BTC ETF Outflows Hit $1.4 Billion

Key Insights

• Bitcoin price continued its strong downward trend on Saturday.
• Spot BTC ETF outflows jumped for the third consecutive week to $1.4 billion.
• There is a risk of more downside as BTC demand continues to wane.

Bitcoin price remained under intense pressure today, May 30, its lowest level since April 13. It has slumped into a technical correction after falling by 11% from its highest point this month. This retreat may continue in the coming days as spot BTC ETF outflows surge.

Bitcoin Price at Risk as ETF Outflows Jump

There are signs that demand for Bitcoin has continued to wane in the past few weeks, and the trend is getting worse. Data compiled by SoSoValue shows that spot ETFs shed over $1.42 billion this week, up from $1.26 billion last week. A week before that, these funds shed $1 billion.

In total, these funds have shed over $3.62 billion in the last three weeks, bringing the total outflows to over $2.4 billion. The cumulative total net inflows stood at over $55.6 billion, bringing the net assets to over $94 billion.

The ongoing spot Bitcoin ETF outflows are a sign that demand among American investors has continued to wane this year. This is partly because many are capitulating after the continued underperformance of the coin.

For example, a $10,000 investment in Bitcoin on January 1 last year would now be worth about $8,300. On the other hand, a similar investment in the S&P 500 and Nasdaq 100 indices would be worth $12,600 and $14,000, respectively.

As such, there are signs that these investors are selling their BTC holdings and rotating towards the better-performing assets. In contrast, data shows that some of the biggest stock market ETFs have continued to add billions of dollars in assets this year. A good example of this is the Roundhill Memory ETF (DRAM) that has added over $12 billion in assets in the past three months.

Donald Trump’s Decision on Iran Waited

The next important catalyst for Bitcoin price is President Donald Trump’s decision on Iran, which is expected to happen this weekend. He met with his senior security officials at the Situation Room to deliberate on the details of his deal.

The deal will lead to the reopening of the Strait of Hormuz, which will lead to more oil supplies and lower prices. At the same time, the deal calls for sanctions relief for Iran and a commitment of $300 billion in investments in the country.

A deal will be highly bullish for Bitcoin as it will lead to lower crude oil prices and inflation. Lower inflation will make it hard for the Federal Reserve to hike interest rates as some officials have hinted. For example, Christopher Waller, the bank’s biggest dove, has said that he would support rate hikes if inflation remained at an elevated level.

On the other hand, if President Trump restarts the war, chances are that Bitcoin and other risky assets will drop sharply. For one, it will lead to heightened chances that the Fed will hike interest rates in the coming months.

Bitcoin Price Prediction: Technical Analysis

The daily chart shows that the BTC price has crashed in the past few days. This retreat started after the coin peaked at $82,650, its highest point on May 6 this year.

The coin has moved below the lower side of the rising wedge pattern, a common bearish reversal sign in technical analysis. It has also plunged below the 50-day moving average and the Average Directional Index (ADX) continues rising. It moved to its highest point since May 18, a sign that the upward momentum is continuing.

Therefore, the most likely Bitcoin price prediction is bearish, with the next important target being at $70,000. A drop below that support will increase the possibility that the coin will drop to $60,000. On the other hand, a move above this month’s high of $82,650 will invalidate the bearish outlook.

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