Bitcoin ETFs Poised for Comeback Despite Price Dip, Whale Investors Eye Support Level

Will Bitcoin ETFs Stage a Comeback Despite BTC's Slump?

The recent market volatility has left a cloud over the spot Bitcoin ETF market, with Bitcoin's price decline casting a long shadow. Data from BitMEX Research paints a bleak picture, showing that Bitcoin ETFs have experienced four consecutive trading sessions of negative net flow.

Outflows Dominate, Hope Emerges

Grayscale's GBTC has been the primary source of outflows, while other ETFs, including BlackRock's IBIT and Fidelity's FBTC, have seen tepid inflows. Amid this downward spiral, a glimmer of hope emerges from Cryptoquant CEO Ki Young Ju's analysis.

Whale Investors' Buying Threshold

In a recent broadcast, Young Ju posits that a surge in spot Bitcoin ETF netflows may be imminent, despite BTC's price weakness. His analysis suggests that demand for Bitcoin ETFs tends to rise when the cryptocurrency approaches certain support levels.

Young Ju has identified that new Bitcoin whales, primarily ETF investors, tend to acquire Bitcoin at an on-chain cost basis of $56,000. This suggests that if Bitcoin's price falls to that level, a wave of inflows into spot Bitcoin ETFs could materialize.

Will Bitcoin Reach $56,000?

Currently, Bitcoin is hovering between $62,000 and $68,000. Young Ju believes a drop to $56,000 is possible, as historical price adjustments have resulted in declines of up to 30%. He forecasts that Bitcoin could even reach as low as $51,000.

Technicals and Market Sentiment

Bitcoin is currently trading around $64,065.74, down 3.73% over the past day and 7.17% over the past week. Trading volume has also decreased by 3.53%, reaching $39.62 billion.

Some analysts believe that Bitcoin may have peaked ahead of the upcoming April halving event. If this is the case, Bitcoin may not recover its previous highs anytime soon and could face further declines in the coming weeks.

Market Outlook

The cryptocurrency market is known for its volatility, and the recent price swings are not uncommon. Market participants are closely monitoring the situation to see how it unfolds.