Bitcoin (BTC) threatened a fresh breakdown through $61,000 on March 20 as analysis warned that support could “crack.”
BTC price weakness targets $60,000
Data from Cointelegraph Markets Pro and TradingView tracked another night of BTC price losses, these so far bottoming at $60,760 on Bitstamp.
Now down 17.5% versus its all-time highs, BTC/USD continued to field selling pressure thanks to several key headwinds.
As Cointelegraph reported, these include outflows from the United States’ spot Bitcoin exchange-traded funds (ETFs) and the March 20 decision on interest rates by the Federal Reserve.
While the outcome of the Federal Open Market Committee (FOMC) meeting is all but guaranteed, Fed Chair Jerome Powell’s subsequent commentary is under the microscope for risk assets.
“With the Fed meeting less than 24 hours away, it’s unlikely the Fed changes rates tomorrow,” trading resource The Kobeissi Letter wrote in part of its recent analysis on X (formerly Twitter).
“However, all eyes will be on guidance after the recent events. We maintain the view that it is far too soon to pivot.”
The latest estimates from CME Group’s FedWatch Tool put the chances of a “pivot” — or return to rate cuts — at just 1% for March 20 and 9.1% for the next FOMC gathering in May.
June’s Fed event has noticeably better odds at 55%.
Analyst: “Some chop first” before Bitcoin ETF rebound
The spot ETFs, meanwhile, saw a second consecutive day of net outflows, per data from United Kingdom-based investment firm Farside.
Related: Bitcoin ‘dumb money sells’ as whales, sharks add 328K BTC in a month
While the exodus from the Grayscale Bitcoin Trust (GBTC) was lower than the record $642 million from March 19, low inflows to the other ETF products made for lackluster statistics.
“Almost $500M USD has flowed out of spot BTC ETFs in the past two trading days,” financial commentator Tedtalksmacro responded.
“Traders taking a wait and see stance pre-FOMC (or just getting out) + tax season in the US being potential reasons for the slowdown. Regular programming will resume, but some chop first.”
In its “Asia Morning Color” daily bulletin sent to Telegram channel subscribers, trading firm QCP Capital nonetheless warned that the second net outflow day could have serious implications for BTC price strength.
“Grayscale saw slightly smaller outflows of -$443.5m overnight but will inflow from the other ETFs bring us to a net positive number today?” it queried.
“Another net negative number will likely cause support to crack.”
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