Bitcoin Rallies 12%, Overcoming ETF Outflows and Federal Reserve's Interest Rates Decision
Summary:
On March 21, Bitcoin (BTC) saw a 12% surge following a quick recovery, positively influenced by the U.S Federal Reserve's decision to maintain current interest rates. While short BTC liquidations amounted to $70 million, fresh outflows from U.S-based Bitcoin exchange-traded funds did not impact the market sentiment. Although Bitcoin didn’t react to a third consecutive day of ETF outflows, market observers remain hopeful, with the CEO of crypto adoption firm JAN3 predicting future net inflows for Bitcoin ETF.
On March 21, Bitcoin (BTC) experienced a quick recovery, delivering a 12% surge in BTC prices. Figures from Cointelegraph Markets Pro and TradingView revealed a period of consolidation within a confined range, following the unexpected rebound from the previous day. Bitcoin's price was positively impacted by the stance of the U.S Federal Reserve to maintain interest rates at their present levels.
After the Federal Open Market Committee meeting, Jerome Powell, the Fed Chair, hinted that lowering rates might be considered appropriate later in the year. The committee is not looking to reduce the target range until there's increased confidence that inflation is progressing steadily towards 2 percent, as voiced in a subsequent press release.
Bitcoin was able to bypass retesting the $60,000 support level, and shot up to $68,000, erasing its preceding losses. Briefing his latest analysis on X (previously known as Twitter), popular trader Jelle mentioned that the goal for today is to stay above $65,300. If this is achieved, it might lead to reclaiming the 2021 peak highs.
Predictably, shorters suffered due to the shift. According to data provided by CoinGlass, short BTC liquidations on March 20 amounted to $70 million. However, fresh outflows from spot Bitcoin exchange-traded funds (ETFs) in the U.S didn't result in a further dampening of sentiments.
The most recent data from Farside, a UK-based investment company, indicates that $261 million was withdrawn from the new ETFs on March 20, predominantly driven by $386 million in outflows from the Grayscale Bitcoin Trust. Although the rest of the ETFs experienced inflows, they totalled only a tiny fraction of the daily revenue earlier in the month.
Despite Bitcoin’s non-reaction to a third consecutive day of outflows, market observers remain positive. The bounce observed today in conjunction with the negative inflow (assuming the values are accurate and inclusive of after-market figures), indicates the market's capability to ascend irrespective of the ETFs, noted Dyme, a popular commentator, in a post on X. Samson Mow, CEO of JAN3, a crypto adoption firm, believes the future might see even GBTC witnessing net inflows. His advice is to plan on the assumption that all Bitcoin ETF outflows will eventually turn into inflows. This article does not present investment advice or recommendations. Every investment move carries its own risks, and readers are advised to carry out thorough research before making any financial decisions.
Published At
3/21/2024 10:53:17 AM
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