In a display of resilience and strength, Bitcoin (BTC) rebounded in early trading on Monday, inching past the $69,900 mark after Friday’s five percent dip and a weekend of sideways trading above $69,000. This recovery comes amidst significant macroeconomic events and a continued influx of capital into spot Bitcoin ETFs.
Macro Factors and Market Sentiment
Friday’s decline, as analysts at Secure Digital Markets noted, “coincided with the liquidation of long positions valued at over $300 million, spurred by the release of robust nonfarm payroll data.” The market’s attention now shifts to critical indicators such as the Consumer Price Index (CPI), the Federal Reserve’s interest rate decision on Wednesday, and the Producer Price Index (PPI) on Thursday.
Current market sentiment leans towards no rate cuts in the summer, with a 47% likelihood of the first cut in either September or November. This sentiment is echoed by Matteo Greco, Research Analyst at Fineqia International, who stated, “Less restrictive monetary policies are generally favorable for risk-on assets such as stocks and digital assets, especially when rate cuts do not foreshadow an impending recession.“
Spot ETFs Drive Bitcoin’s Ascent
A key driver of Bitcoin’s resilience has been the continuous inflows into spot Bitcoin ETFs. Friday marked the 19th consecutive day of inflows, with $131 million flowing into ETF coffers. Last week alone, U.S.-listed BTC ETFs saw inflows of $1.83 billion, contributing to a global five-week inflow streak of $4.3 billion into digital asset investment products.
James Butterfill, Head of Research at CoinShares, noted an unusual trend: “Inflows were seen across almost all providers, with a continued slowdown in outflows from incumbents.” He attributes this sentiment shift to weaker-than-expected U.S. macro data, bringing forward monetary policy rate cut expectations.
Projections and Global Adoption
Network economist Timothy Peterson projects that if ETF inflows continue, Bitcoin could hit a new all-time high by July 31 and reach $135,000 by year-end.
Meanwhile, global adoption continues apace. Matteo Greco highlighted, “BTC’s integration into traditional finance continues to expand worldwide,” citing the launch of Australia’s first BTC Spot ETF and Thailand’s approval for its first BTC Spot ETF.
As the market eagerly awaits the Fed’s interest rate decision and May’s CPI figures, Bitcoin’s resilience in the face of job cuts and its growing integration into traditional finance underscore its evolving role in the global financial landscape.
