Bitcoin price prediction: Many market participants including analysts and experts expected Bitcoin price to retrace in February. However, the largest cryptocurrency boasting $1.22 trillion in market cap and $55 billion in 24-hour trading volume, closed 45% higher from the monthly open to trade at $62,000 at the tail end of the European session on Friday.
How ETF Inflows Are Changing The Bitcoin Landscape
The commutative total net inflow since the Securities and Exchange Commission (SEC) green-lighted Bitcoin ETFs in January reached $7.49 billion on February 29, underscoring the immense interest from investors, especially institutional.
According to SoSoValue, a company that tracks the performance of ETF products, BlackRock’s IBIT ETF remains the best-performing ETF, achieving $603 million in total net inflow on Thursday.
At the other extreme end is Grayscale, which has consistently grappled with net daily outflows following the conversion of the Bitcoin Trust to GBTC ETF. This ETF saw a daily net inflow of -$598 on Thursday, thus significantly reducing the daily total net inflow volume to $92.38 million.
The supply and demand landscape for Bitcoin continues to change, driven by increasing ETF inflows. On top of this, investors are preferring to hold onto their BTC in anticipation of a larger breakout post-halving in February.
Bitcoin’s halving, which cuts miner rewards by half every four years. The last halving took place in 2020, placing the next event in 2024 around April.
In addition to giving Bitcoin its deflationary status, halving significantly reduces the amount of new coins joining the ecosystem. Remember miner rewards will come down to 3.125 BTC from the current 6.25 BTC.
It is this gradual decrease in supply coupled with demand increasing or staying the same that tends to drive Bitcoin price parabolically higher. The ETF is also expected to have a major impact on BTC as demand soars.
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Bitcoin Price Prediction: Uptrend To $70,000 Unstoppable In March?
The uptick above $60,000 drastically changed the technical aspect, becoming stronger. Bitcoin tested highs at $64,000 but corrected to test support at $60,000 on Wednesday.
Bolstered by a sharp rise in FOMO, BTC had stabilized above $62,000 on Friday. Based on the Crypto Fear & Greed Index investors are now in extreme greed at 80 compared to the greed at 60 last month.
On the four-hour chart, traders are looking for consecutive four-hour candle closes above the yellow horizontal ray to validate extended movement north.
The area at $63,000 represents a sell wall that must be weakened to allow for gains above $64,000 (the red line on the chart). A break above this would trigger more FOMO with market participants targeting a sweep of the all-time high followed by a leg up beyond $70,000.
A minor dip in the Moving Average Convergence Divergence (MACD) threatens to slow down the uptrend. By encouraging traders to close their positions.
However, this condition may not hold or last considering the Money Flow Index (RSI) is neutral and rolling upwards, indicating that liquidity is increasing for another leg up. Several four-hour closes below the yellow support line could see BTC drop to retest the $60,000 level before resuming the uptrend backed by more buying pressure.
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The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
Source: https://coingape.com/markets/bitcoin-price-prediction-are-etf-inflows-fuelling-btc-rally/
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