US Spot ETF Market Ends Outflow for Second Consecutive Day
On February 13th, the Spot ETF recorded net inflows of $15.1 million, likely influenced by expectations of interest rate cuts from the Federal Reserve. While the inflows were modest, there was a noticeable shift in sentiment as two days of outflows came to an end. However, the reporting week that concluded on the same date marked the fourth consecutive week of overall outflows, which has limited Bitcoin’s gains.
Key flows for that week included:
- iShares Bitcoin Trust (IBIT) faced net outflows of $234.8 million.
- The Fidelity Wise Origin Bitcoin Fund (FBTC) saw net outflows of $124.7 million.
- Grayscale Bitcoin Trust (GBTC) reported net outflows of $77 million.
- In total, while six ETF issuers saw net inflows, five experienced net outflows.
Even with a return to $70,000, the four weeks of outflows have impacted Bitcoin, which is down 19.74% year-to-date. The trends in Spot ETF flows suggest a bearish outlook may be looming.
Bitcoin and the Upcoming US Economic Calendar: Focus on GDP, Inflation, and PMI Data
As we look ahead, US economic data is likely to shape risk sentiment, particularly following reactions to the recent US CPI report.
The minutes from the Federal Open Market Committee’s meeting on February 18th will shed light on the Fed’s policy direction. Chairman Powell has somewhat dismissed the chance of imminent interest rate cuts, pointing to the strength of the labor market and persistent inflation. However, if January’s inflation figures show improvement, market participants may develop a renewed appetite for rate cuts.
February 20th appears to be a key date for Bitcoin’s short-term price dynamics, with the US Personal Income and Expenditure Report, Services PMI data, and Q4 GDP figures all expected to impact market sentiment regarding the Fed’s interest rate trajectory.
If December’s core PCE price index comes in better than expected and there’s an uptick in service sector activity for January, this could dampen speculation around interest rate cuts in June, affecting BTC demand. Conversely, disappointing GDP figures might overshadow personal income reports and lend more significance to the services PMI.
In addition to the January services PMI, traders should also keep an eye on pricing trends. Declining input and output prices align with the January CPI data and could suggest a more dovish stance from the Fed.
If the upcoming US economic data aligns with expectations, the near-term outlook doesn’t seem rosy. Despite this, there remains a glimmer of optimism that the US Senate may eventually pass a market structure bill, which could favor a more bullish medium-term perspective for Bitcoin.
Bitcoin Fear and Greed Index Indicates Bearish Sentiment
Even after reclaiming $70,000, the Bitcoin Fear and Greed Index shows it remains firmly in the extreme fear zone. The index dropped from 9 to 8 on February 15th, despite a rise from 7 just a week prior. This persistent extreme bearish sentiment often signals potential price recoveries and supports a more positive outlook in the medium term.
