Bitcoin Eyes $65K as Recession Fears Ease, But US ETF Outflows Pose Potential Downside

BTC Eyes $65K Amid Market Optimism: Will It Break Through?

On Monday, August 19, BTC advanced by 1.73%, partially reversing the previous day’s 1.90% loss to close at $59,501. The total crypto market increased by 1.71%, rising to a crypto market cap of $2.062 trillion.

Calming US Recession Fears Fuel BTC Demand

Easing investor fears of a US economic recession (hard landing) drove BTC demand. Goldman Sachs recently revised the probability of a US recession from 25% to 15%, assuming the August US Jobs Report delivers no surprises.

However, Bloomberg TV Asia Pacific Chief Markets Editor David Ingles shared a chart, predicting a 30% probability of a US recession.

The difference in views highlighted the uncertainty about the US economy before the August US Jobs Report.

Despite the contrasting views, speculation about the possibility of multiple 2024 Fed rate cuts also fueled BTC demand. Nevertheless, the US BTC-spot ETF market could see net outflows as investors await Fed Chair Powell’s Jackson Hole speech on Friday.

US BTC-Spot ETF Market Outflows Influence BTC Price Trends

On Monday, the US BTC-spot ETF market could see total net outflows. According to Farside Investors,

• Bitwise Bitcoin ETF (BITB) had net outflows of $25.7 million.
• Invesco Galaxy Bitcoin ETF (BTCO) reported net outflows of $8.8 million.
• Fidelity Wise Origin Bitcoin Fund (FBTC) saw net inflows of $3.9 million.

Excluding flow data for iShares Bitcoin ETF (IBIT), the US BTC-spot ETF market saw total net outflows of $30.6 million.

The US BTC-spot ETF flow trends were BTC price negative while market risk sentiment contributed to BTC price gains. On Monday, the Nasdaq Composite Index rallied 1.39%, extending its winning streak to eight sessions on hopes for a September Fed rate and soft US economic landing.

Future Expectations and Risks

Expectations of a soft economic landing and the possibility of multiple 2024 Fed rate cuts could push BTC toward $65,000. However, investors should consider US BTC-spot ETF flow trends and oversupply risk. Waning demand for US BTC-spot ETFs and possible supply from the US government and Mt. Gox could pull BTC toward $55,000.

Investors should remain alert amid possible changes to supply-demand trends. Stay updated with our latest news and analysis to manage exposure to BTC and the broader crypto market.

Technical Analysis

Bitcoin Analysis

BTC remained above the 200-day EMA while holding below the 50-day EMA, affirming bearish near-term but bullish longer-term price signals.

A break above the 50-day EMA would support a move toward the $64,000 resistance level. Furthermore, a breakout from the $64,000 could give the bulls a run at the $69,000 resistance level.

US BTC-spot ETF market flow trends, supply-related news, and Fed chatter require consideration.

Conversely, a break below the 200-day EMA could signal a drop to $55,000. A fall through $55,000 could give the bears a run at the $52.884 support level.

With a 49.82 14-Daily RSI reading, BTC could fall to the $55,000 handle before entering oversold territory.

Ethereum Analysis

ETH remained well below the 50-day and 200-day EMAs, affirming bearish price signals.

An ETH break above the $2,664 resistance level could support a move toward $2,800. Furthermore, a breakout from $2,800 could give the bulls a run at the 50-day EMA and the $3,033 resistance level.

US ETH-spot ETF market-related news also requires consideration.

Conversely, an ETH fall through $2,500 could signal a drop to the $2,403 support level.

The 14-period Daily RSI reading, 42.23, suggests an ETH fall to the $2,403 support level before entering oversold territory.