Hassan Maishera
TL;DR
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Bitcoin recovered to around $61,700 on Thursday after falling to a 21-month low of $59,103.
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Institutional selling remains a major headwind, with spot Bitcoin ETFs recording $469 million in net outflows on Wednesday.
Bitcoin Recovers Modestly Following Sharp Sell-Off
Bitcoin (BTC) staged a modest recovery on Thursday, trading around $61,700 after plunging to a new yearly low of $59,103 and its weakest level in 21 months during the previous session.
Despite the rebound, the cryptocurrency remains under significant pressure as institutional investors continue to reduce exposure.
Persistent outflows from spot Bitcoin exchange-traded funds (ETFs), combined with uncertainty surrounding U.S. monetary policy, have weighed heavily on market sentiment.
Investors are now focused on the release of the U.S. Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve’s preferred inflation gauge, which could shape expectations for interest rates and determine Bitcoin’s next major move.
Institutional demand for Bitcoin continued to weaken this week, adding to the cryptocurrency’s bearish outlook.
According to CoinGlass data, U.S. spot Bitcoin ETFs recorded net outflows of $469.00 million on Wednesday, marking the third consecutive day of capital withdrawals.
The sustained outflow trend suggests large investors remain cautious amid growing macroeconomic uncertainty.
If ETF redemptions continue to accelerate, Bitcoin could face additional downside pressure in the near term.
The recent wave of institutional selling highlights the growing influence of ETF flows on Bitcoin's price action.
While spot Bitcoin ETFs played a major role in driving demand earlier in the year, continued outflows now represent a significant headwind for the market. Investors will be closely monitoring upcoming fund flow data for signs of stabilization or further deterioration in institutional sentiment.
Why the US PCE Inflation Report Matters for Bitcoin
Market participants are now turning their attention to Thursday’s release of the U.S. PCE Price Index.
As the Federal Reserve’s preferred measure of inflation, the report is expected to provide important clues about the future path of monetary policy. A softer-than-expected reading could strengthen expectations for interest-rate cuts, while a higher reading could reinforce concerns that rates will remain elevated for longer.
Either outcome could have a significant impact on Bitcoin and broader risk assets. Recent developments in global energy markets have helped ease inflation concerns.
Crude oil prices have fallen sharply following the reopening of the Strait of Hormuz and the implementation of a temporary 60-day sanctions waiver that permits the production, sale, and delivery of Iranian crude oil and petroleum products. The decline pushed oil prices to their lowest levels since before the U.S.-Iran conflict.
Lower energy prices typically reduce inflationary pressure across the economy, potentially limiting the need for aggressive monetary tightening by the Federal Reserve.
As a result, Treasury yields have eased, and the U.S. dollar's upward momentum has moderated.
Despite improving inflation expectations, Bitcoin has struggled to attract buyers.
The cryptocurrency continued its decline on Wednesday, falling to levels last seen in October 2024. The disconnect suggests that broader risk sentiment remains fragile, with investors focused on institutional selling, geopolitical uncertainty, and concerns about future economic growth.
Although progress in U.S.-Iran peace negotiations initially improved market sentiment, ongoing tensions involving Israel and Lebanon continue to fuel caution across financial markets.
Bitcoin Technical Analysis: Bears Maintain Control
Bitcoin remains firmly in a bearish trend despite Thursday's modest recovery. The cryptocurrency is currently trading well below its key moving averages, including the 50-day, 100-day, and 200-day Exponential Moving Averages (EMAs), which are clustered between approximately $68,265 and $77,223.
This positioning indicates that sellers continue to dominate the broader market structure.
The Relative Strength Index (RSI) on the daily chart is hovering near 36, suggesting that while selling pressure has eased somewhat, bullish momentum remains limited.
Meanwhile, the Moving Average Convergence Divergence (MACD) indicator remains marginally above the zero line, signaling that downside momentum is weakening but has not yet fully reversed.
On the upside, Bitcoin faces immediate resistance near the horizontal barrier at $64,004.
A stronger recovery could bring the 50-day EMA around $68,265 into focus, followed by the 100-day EMA near $71,515.
Longer-term resistance remains concentrated around the 200-day EMA at $77,223 and the major horizontal resistance zone near $84,410.
On the downside, traders are closely watching the psychologically important $60,000 level. A decisive break below this support could trigger another wave of selling and open the door for a deeper correction.
Bitcoin's near-term direction is likely to depend on two critical factors: the outcome of the U.S. PCE inflation report and the trajectory of institutional ETF flows.
While easing inflation pressures could support risk assets, persistent ETF outflows and uncertainty surrounding Federal Reserve policy continue to weigh on sentiment.
Until institutional demand returns and key technical resistance levels are reclaimed, Bitcoin may remain vulnerable to further downside volatility.
