Bitcoin Price Rises Above $62K as ETF Inflows End 10-Day Outflow Streak

Quick overview

Bitcoin (BTC/USD) extended its bullish bias and is still showing gains in the Asian trading session. At the time we are writing this article, the coin is trading at the $62,392.04 level, showing more than 1.19 percent gains on the day. The reason for its strong performance can be attributed to the fact that investors returned from the US Independence Day holiday and continue to digest weaker US labor market data. This helped BTC maintain its bullish momentum and supported further price gains. Moreover, the gains were also supported by the report that US spot Bitcoin ETFs ended 10 day outflow streak with $221.7 million in net inflows.

Weak US Dollar Helps Bitcoin Move Higher

On the US front, the broad based US dollar failed to stop its previous bearish performance and remained under pressure around the 100.85 level. This is because traders are still digesting weak US labor market data. On the data front, the US only created 57,000 new jobs in June, which is much lower than the expected 110,000. Meanwhile, the unemployment rate stood at 4.2 percent, and the latest weekly jobless claims came in at 215,000.

As a result, many traders now believe the Federal Reserve will not increase interest rates soon. Markets now see less than 20 percent chance of a rate hike in July. This was seen as one of the key factors behind the US dollar’s decline. When the dollar weakens (DXY near 100.85), it helps other investments, like stocks and crypto, feel stronger and rise in price. This is why Bitcoin is rising right now and is set to end this week on the bullish track.

Looking forward, Investors are keeping thier eyes on the latest FOMC meeting minutes, which are scheduled to be released on Wednesday. Meanwhile, the weekly Initial Jobless Claims data will also be in the spotlight as it will provide more clues about the Fed next move.

It is worth mentioning that the June meeting was the first under new Chair Kevin Warsh, where the Fed kept interest rates steady between 3.50 percent to 3.75 percent. If the minutes show the Fed is taking a softer approach or feels more confident that inflation is coming down, the US dollar will likely remain under pressure.

For the crypto market, the weaker US dollar is generally seen as a positive sign as investors become more willing to buy riskier assets such as Bitcoin and other cryptocurrencies when the dollar loses strength.

New ETF Inflows Support Bitcoin Price

Moreover, the positive trend in Bitcoin price was also strongly supported by good news from US Bitcoin ETFs. On Thursday, BTC ETFs witnessed net inflows of 221.7 million dollars. This was a big relief because it ended a 10 day streak of continuous outflows. Not only this, but it was the strongest single day money inflow in nearly two months.

As a result of this, the Bitcoin price, which had dropped below $58,000 earlier in the week, recovered nicely and rose above the $62,000 level. This is because investors turn more confident seeing fresh money coming into the market.

Let’s talk in detail, Fidelitys FBTC fund was the biggest gainer with 166 million dollars in inflows. ARKB also received 91.8 million dollars, while the VanEck fund got 4.4 million dollars.

On the negative side, the BlackRock IBIT fund witnessed 40.4 million dollars in outflows. These Bitcoin ETFs had seen around 2.7 billion dollars flowing out in the past 10 days. Whereas, the whole month of June was the weakest ever, with nearly 4.5 billion dollars in total outflows.

After so many days of outflows, people are now feeling more positive and believe that the heavy selling pressure will finally slow down or end soon.

ABOUT THE AUTHOR See More

Arslan Butt

Lead Markets Analyst – Multi-Asset (FX, Commodities, Crypto)

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics. His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker. His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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