Bitcoin prices rose on the rise in the US CPI reading, topping $100,000. Still, financial institutions are redeeming BTC Spot ETF shares.
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Price movement in the past 7 days
This week has been eventful. The good news is that the price remains at the upper end of this month's price range, which is a bullish indicator.
After a worrying drop below $90,000 earlier this week, prices rebounded strongly on Wednesday, January 15th, topping $100,000 for the second time this month.
It was last printed early last week, when the price soared to $102,000 and then plummeted to $91,000. Although the price is currently rising, it is unclear whether Bitcoin has fully recovered.
Interestingly, despite Bitcoin's recent rally, institutional investors seem to be skeptical of the uptrend. Their wariness is understandable.
Bitcoin price rises due to inflation data
Bitcoin and financial markets are unexpectedly rising following mixed economic data from the US.
Yesterday, the Department of Labor reported that the Consumer Price Index (CPI) rose the fastest in nine months, mainly due to rising energy costs.
However, although inflation is rising, underlying inflationary pressures appear to be easing. Most importantly, core inflation is slowing, which is a positive sign.
The report follows the Department of Labor's revelation that the producer price index (PPI) rose more slowly than economists expected.
Analysts therefore concluded that the combination of slower core inflation and slower-than-expected PPI growth could result in a cooling economy and lower inflation.
This suggests that the Fed, which adopted a hawkish stance at the December FOMC meeting, may not aggressively implement monetary tightening in the first quarter of 2025.
Bitcoin is becoming increasingly sensitive to monetary policy decisions, and its price can rise or fall depending on the path the Federal Reserve chooses.
Signs that the economy is “warming” resonate favorably with traders, stimulating demand and ultimately pushing Bitcoin above $100,000.
Technically, the uptrend remains intact and the price is likely to remain within the bull flag as long as BTC trades above $90,000. A break above $108,000 could push the world's most valuable cryptocurrency towards $120,000 as bulls double down.
(BTCUSDT)
Wall Street skeptical about $100,000
While traders remain optimistic and momentum has been building since the price topped $100,000, institutional demand for spot Bitcoin ETFs is drying up.
According to Lookochain data, financial institutions appear to be redeeming shares.
(sauce)
On January 15th, over 3,000 BTC worth $302 million was redeemed. Notably, BlackRock's iShares also experienced an outflow of 2,274 BTC, or $224 million.
Furthermore, on January 14th, institutional investors continued selling, withdrawing 2,244 BTC worth $216.1 million.
(sauce)
The fact that the “majors” are redeeming their own shares suggests widespread hesitation among institutional investors. Bitcoin's rally and spot Bitcoin ETFs experiencing outflows could indicate profit taking or money being moved to other assets such as bonds.
This approach makes sense. After the November rally, the crypto market appeared to be overextended.
Combined with lingering market concerns, Wall Street may be wary of overcommitting amid continued economic uncertainty.
Nevertheless, this outlook could change if Bitcoin continues to rise and breaches $108,000.
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The post “Bitcoin regains $100,000 on inflation data, but the big boys aren’t convinced” originally appeared on 99Bitcoins.
