(Kitco News) – Crypto traders continued to grapple with unfriendly market conditions on Monday as Bitcoin’s (BTC) price fell below $62,000 to hit its lowest price in over a month amid outflows from spot BTC exchange-traded funds (ETFs).
Data provided by TradingView shows that King Crypto lost support at $64,000 in the early morning hours on Monday, with bears managing to hammer the top crypto to a low of $60,558 before bullish reinforcements managed to halt the downturn and push it back above $61,000.
BTC/USD Chart by TradingView
“Bitcoin is experiencing a serious case of the Monday blues, with prices slipping below $62,000 - the lowest mark for almost six weeks,” said Neil Roarty, an analyst at Stocklytics. “Some bears are arguing this is a fundamental shift in both market and mood. They’ll point to how Bitcoin no longer appears to be tracking with the NASDAQ, which soared to record highs last week.”
Roarty also noted the uptick in rumors “that whales - including some of the biggest miners and even the German government - are offloading their holdings.”
“If the negative sentiment prevails, how far could we slide? Nothing’s off the table, but bears have already highlighted the symbolic $50,000 mark as a near-term possibility,” he warned. “The bulls will have to console themselves with the knowledge that, as always in crypto, fortunes can reverse extremely quickly.”
While no one likes to see their investment in a downtrend, market analyst Grizzly said the “current market correction is considered healthy unless a specific level is breached.”
“One of the most significant on-chain metrics for analyzing the behavior of short-term holders, who predominantly act as speculators, is the Realized Price-UTXO Age Bands,” Grizzly wrote. “Historically, this metric has effectively served as support and resistance within the market. When combined with technical levels, it provides more robust insights.”
“Currently, the price of Bitcoin has fallen below this metric,” he observed. “By incorporating the static technical support level around $60,000 into our analysis, it becomes evident that Bitcoin still has potential for further correction.”
“Furthermore, the 3-month to 6-month band is nearing this technical support level, potentially reinforcing its strength, similar to the behavior observed in September,” he said.
“At present, the correction appears to be healthy,” Grizzly concluded. “However, should bearish momentum persist, the subsequent substantial support level is anticipated to be around $50,000.”
ETF outflows and declining trading volumes
Monday’s weakness in Bitcoin and the broader crypto market follows the second consecutive week of outflows from globally listed digital asset investment products, according to data provided by Coinshares.
Last week, $584 million escaped crypto funds, bringing the total drawdown over the past two weeks to $1.2 billion.
“We believe this is in reaction to the pessimism amongst investors for the prospect interest rate cuts by the FED this year,” said James Butterfill, Head of Research at CoinShares. “Last week also saw the lowest volumes traded on ETPs globally since the US ETFs were launched in January, seeing just US$6.9bn for the week.”
The U.S. accounted for the bulk of outflows, with $475 million pulled from listed products, while Canada recorded outflows of $109 million.
“Outflows were also seen in Germany and Hong Kong at US$24m and US$19m respectively,” Butterfill said. “Switzerland and Brazil bucked the consensus, seeing inflows of US$39m and US48.5m respectively.”
The majority of outflows came from Bitcoin products, which saw a decline of $630 million in assets under management. While negative sentiment spiked, traders remain hesitant to bet against Bitcoin, as evidenced by the fact that short Bitcoin products also saw $1.2 million in outflows.
“Ethereum (ETH) did not escape the negative sentiment, seeing US$58m in outflows,” Butterfill said. “While a range of altcoin saw inflows after recent price weakness, most notable were Solana, Litecoin and Polygon at US$2.7m, US$1.3m, and US$1m, respectively. Multi-asset products saw US$98m inflows, suggesting investors saw the weakness in the altcoin market as a buying opportunity.”
At the time of writing, Bitcoin trades at $61,150, a decrease of 4.67% on the 24-hour chart.
