Bitcoin
Why is the crypto market bearish today?
Bitcoin and other cryptocurrencies fell on Tuesday morning. Despite significant flows into Bitcoin-linked exchange-traded funds, the leading cryptocurrency is not seeing a significant increase. Bitcoin declined 3.6% in the last 24 hours to $66,867. It hit a record near $74,000 in mid-March due to a surge in interest in new spot exchange-traded funds.
On the other hand, the price of ETH is falling sharply despite the recent approval of the Ethereum spot ETF by the SEC. The price of Ethereum has fallen more than 4.2% in the last 24 hours, currently testing the patience of buyers at $3,500. The main altcoins also suffered declines: SOL fell 4.8%, BNB fell 5.8%, and Toncoin and Cardano lost almost 4% each.
The meme coin sector, which had been performing well, also felt the market slowdown. Pepe prices fell by more than 3%, while Shiba Inu and Dogecoin prices fell by 5.3% and 4.4%, respectively.
According to data from Coinglass, total liquidation exceeded $213 million in the last 24 hours, and buyers closed around $190 million worth of long positions.
Bitcoin ETF faces exit
On June 10, data from Farside showed that Bitcoin (BTC) exchange-traded funds (ETFs) saw an outflow of $64.9 million. This marked the first exit since May 10, ending a 19-day streak of entries. Four ETF issuers contributed to these outflows.
Grayscale’s GBTC led the way with outflows of $39.5 million, totaling $18 billion in overall outflows. The BTCO Invesco Galaxy ETF has seen outflows of $20.5 million, although its total net inflow remains positive at $300 million. Valkyrie’s BRRR ETF saw an outflow of $15.8 million, but still has a total net inflow of $497 million. Fidelity’s FBTC had a smaller outflow of $3 million, but maintains a strong total inflow of $9.6 billion.
Read too: Top 3 Reasons Bitcoin Price Dropped Today: Should You Sell?
This downward movement in the Netflow metric triggered a decline in buying pressure for the BTC price, resulting in the loss of the $70K milestone.
US inflation increases selling pressure
A report from the Bureau of Labor Statistics on the Consumer Price Index, a key measure of the cost of living, is expected Wednesday. According to a survey conducted by Dow Jones Newswires and the Wall Street Journal, economists forecast that prices rose 0.1% in May, down from a 0.3% increase in April, marking the smallest increase since October. This would result in an annual increase of 3.4%, equal to the rate recorded in April.
See more information: US CPI stimulates Bitcoin volatility: new price rise or fall?
The US Federal Reserve will release its FOMC statement, economic projections and interest rate decisions tomorrow, setting up a tough battle between the bears and the bulls.
Continued selling pressure has caused a decline in the market’s fear and greed index. In just a few days, the index has fallen from a high of almost 66 to a recent low of 60. This indicates a shift towards a “Fear” sentiment in the market.
ECB rate cut created negative sentiment
Last week, crypto markets started falling following the US unemployment claims report. Furthermore, bearish sentiment increased due to the ECB’s rate cut. Despite a neutral stance and no clear commitment to further easing, the rate cut reduced the euro’s yield advantage.
The ECB’s more dovish approach compared to the Fed and the possibility of further cuts have intensified the selling momentum in the crypto market.