Bitcoin ETFs faced outflows of $85.64 million on Tuesday, halting a significant inflow trend. This pullback from institutional investors comes ahead of the Federal Reserve’s policy decision, indicating concerns over volatility. Despite ETF withdrawals, spot market inflows suggest some investors are shifting to direct Bitcoin purchases in anticipation of price movements.
In a notable shift, Bitcoin spot ETFs experienced significant net outflows recently, ending a three-day streak of inflows worth more than $1 billion. On Tuesday, institutional investors began to pull back their exposure, seemingly anticipating increased market volatility as the Federal Reserve gears up for its latest policy meeting. The net outflow on that day amounted to approximately $85.64 million, signalling a more cautious approach among institutional players just ahead of today’s FOMC announcement.
The change in sentiment comes after a notably strong performance by Bitcoin ETFs, which had attracted substantial capital over the past few days. The decision to reduce exposure can be seen as a strategic one, aimed at minimising potential short-term losses should unexpected signals come from the Fed. Nevertheless, another layer of activity can be observed; while institutional investments may be dwindling in ETFs, there is evidence of increased inflows into spot positions, indicating a possible reshuffling of funds that might allow investors to benefit from anticipated market movements.
Data from Coinglass highlights that even as institutions depart from ETFs, spot inflows saw a noteworthy bump, coming in at $9.72 million. This reflects a rising demand as more coins and tokens are being transferred into spot markets. This accumulation trend suggests that despite some pulling back, there is more buying action occurring among market participants focusing on direct Bitcoin assets, which can support upward price movement if the trend continues.
As for Bitcoin’s performance, it’s currently priced at $96,679, experiencing a 2% increase over the last 24 hours. This uptick aligns with a heightened Balance of Power (BoP) indicator, which sits at 0.10. This metric compares the closing price to the trading range over a given timeframe, indicating the strength ratio between buyers and sellers. A positive value implies that buyers are prevailing, fostering bullish momentum for Bitcoin’s price.
Should demand for BTC maintain its current trajectory and market conditions remain stable after the FOMC meeting, potential exists for the coin to rise up to about $102,080. In contrast, if the market swings negatively, Bitcoin could easily lose ground, plunging below support levels and possibly descending to around $92,048, following breaches at $96,187. Close attention will be necessary in the aftermath of the Fed’s announcements, as market sentiment can shift rapidly.
