Key Points
- Bitcoin records first positive Spot ETF flows since 8 January, highlighting a potential decoupling.
- Despite high demand from whales, overall demand remains weak, suggesting short-term movements for Bitcoin.
Bitcoin recently experienced its first positive Spot ETF flows on Wednesday, following consistent outflows since 8 January.
This development reveals intriguing insights about the impact of these flows on the market.
Decoupling of Bitcoin and Spot ETF Flows
Traditionally, Bitcoin’s price action has mirrored Spot ETF flows. However, this pattern seems to be changing. For instance, despite a week of negative Spot ETF flows, Bitcoin managed a 12.81% surge from its lowest price point this week, reaching a local high of $100,175 on Wednesday.
This suggests a possible decoupling between Bitcoin and Spot ETF flows, which could continue throughout the week.
On 15 January, Bitcoin Spot ETF flows saw $755.1 million worth of inflows, marking the third highest daily flows recorded this month. Despite these inflows, Bitcoin experienced slight losses of just over 1.5% in the last 24 hours.
Bitcoin’s Short-Term Market Movements
At the time of writing, Bitcoin was trading at $99,236, with more downside seeming likely.
This is due to Bitcoin’s recent price uptick retesting a descending resistance line and showing some sell pressure, signalling that the resistance level remains robust.
On-chain data reveals that Bitcoin has been experiencing outflows in the spot segment, with $156.01 million in spot outflows in the last 24 hours. This surge in outflows suggests that investors are focusing on short-term profit-taking, indicating a not-so-bullish short-term sentiment.
Whale activity aligns with this short-term sentiment, with large holder flow data showing 1,420 BTC inflows on Wednesday, compared to 494 BTC in outflows. Despite higher demand from whales, overall demand remains weak compared to December’s demand spikes.
Low whale participation could indicate a lack of confidence in the market, suggesting that Bitcoin’s price movements may be short-term. As such, the price is likely to retreat from the resistance level. Nonetheless, investors should remain vigilant for major developments that could sway the market.
