Bitcoin ETFs Demand Returns with $105 Million Inflows on Monday

Bitcoin ETFs market rebound continues to strengthen, with reports showing $105 million inflows on June 3. This marks 15 consecutive trading days (three weeks) of positive flows and brings the cumulative inflows to $2.40 billion, as the on-chain data platform SpotOnChain shows.

Bitcoin ETFs saw a surge in demand on Monday, with data from on-chain platform SpotOnChain revealing inflows of $105 million. This marks 15 consecutive trading days (three weeks) of positive flows, bringing the total cumulative inflows to $2.40 billion.

The inflows varied across different ETFs. Fidelity's Bitcoin ETF (FBTC) led the day with inflows of up to $77 million (over 1,110 BTC), while Grayscale's GBTC and BlackRock's IBIT recorded zero net flows. Bitwise ETF (BITB) saw inflows of $14 million, and Ark21Shares' ARKB ETF had up to $10 million in positive flows.

This surge in ETF demand coincides with an increase in global liquidity. As Bitcoin analyst Willy Woo points out, the correlation between BTC price and M2 expansion reflects broader market sentiment and economic conditions.

A high M2 expansion indicates a loose monetary policy and increased money supply. In response, Bitcoin's price tends to rise as investors seek alternative assets for potential returns.

Notably, Bitcoin's price usually reacts positively to rising money supply and inflation concerns. This is because investors view BTC as a hedge against traditional fiat currencies like the US dollar, which could depreciate due to inflation.

Bitfinex analysts highlighted in their Monday market update that Bitcoin ETF inflows have averaged $136 million per day over the last two weeks. "This is 4x the $32M daily sell pressure from miners." They noted, adding that this period marks a "Bitcoin accumulation phase."

The analysts also noted that the correction phase may be coming to an end. They attributed the recent drop from highs of $73,777 to selling activity among long-term holders. The report suggests that long-term holders have begun to re-accumulate BTC for the first time since December 2023.

After the April 20 Bitcoin halving, investor confidence has surged, bolstering the bullish narrative. This is evident in the rising Bitcoin realized capitalization, which approaches $600 billion.

The BTC Realized Cap metric showcases Bitcoin's true value based on the price at which coins last moved. It provides a unique perspective on market dynamics, investor behavior, and historical trends within the Bitcoin ecosystem.

The Bitcoin price continues to consolidate along an ascending trend line since May 1, forming a series of higher lows. Trading 22% above the range low of $56,552, BTC seems poised for further gains as it attempts to break out of consolidation.

Tailwinds for bullish price action emerge with a buy signal triggered when the Relative Strength Index (RSI) crosses above the signal line (yellow band). If traders follow this call, Bitcoin's price could head north. The Awesome Oscillator's position in positive territory indicates bullish sentiment, supporting the bullish thesis.

On the other hand, the volume profile shows that while there is a lot of bullish activity (orange nodes) waiting to interact with Bitcoin price at current levels, there is even more bearish activity (grey nodes). Hence, the bulls must propel BTC above the $72,149 resistance for Bitcoin price to clear the forest.

A drop below $67,594 could spark panic selling, potentially driving the price down to $65,000. If that level doesn't hold, Bitcoin could re-test the $61,169 support, presenting a potential buying opportunity for investors.

In a worst-case scenario with strong bearish momentum, a candlestick close below $56,000 would invalidate the bullish outlook. At the time of writing, the Bitcoin price is trading at $69,429.