Bitcoin News Today: Fed Chair Powell Impacts BTC Despite BTC-spot ETF Inflows

Key Insights:

• BTC fell by 0.93% on Wednesday, ending the session at $42,580.
• The US Federal Reserve poured cold water on rate cuts bets, offsetting favorable BTC-spot ETF flows and volume numbers.
• On Thursday, BTC-spot ETF-related updates, SEC chatter, and US labor market data warrant investor attention.

BTC-Spot ETF Inflows Contribute to Pre-Fed Gains

BTC fell by 0.93% on Wednesday. Following a 0.82% loss on Tuesday, BTC ended the session at $42,580.

BTC-spot ETF market flow and volume data contributed to pre-Fed interest rate decision gains. BTC rose to a Wednesday session high of $43,762 before hitting the reverse.

Bloomberg Intelligence ETF analyst James Seyffart shared the Day 13 flows and volumes.

On January 30 (Trading Day 13), the BTC-spot ETF market saw net inflows for the third consecutive day. GBTC outflows increased to $221 million. However, iShares Bitcoin Trust (IBIT) saw net inflows of $299.2 million, offsetting outflows from GBTC.

On January 30, iShares Bitcoin Trust topped the inflows table. However, Fidelity Wise Origin Bitcoin Fund (FBTC) saw net inflows slide from $208.2 million to $119.2 million.

Seyffart addressed questions on links between trading volumes and inflows, saying,

“Also. A lot of the same questions. There isn’t a consistent ratio of Volume to Flows. It changes and it’s hard to know with certainty. Yes, GBTC is likely to see outflows again today but the volume level definitely isn’t always indicative of the amount of outflows.”

On January 30 (Day 13), iShares Bitcoin Trust saw lower trading volumes but higher net inflows.

According to BitMEX Research, GBTC outflows totaled $188 million on Day 14, down from $221 million on Day 13. The fall in GBTC net outflows could signal a fourth consecutive day of net inflows for the BTC-spot ETF market.

US Federal Reserve and Fed Chair Powell Send BTC into Negative Territory

On Wednesday, the Fed left interest rates at 5.50%. During the FOMC Press Conference, Fed Chair Powell poured cold water on expectations of a March Fed rate cut. Powell warned the Fed needed more confidence in inflation sustainably returning to 2% before considering rate cuts.

The Fed Chair also said it was too soon to expect the US economy to avoid a hard landing.

BTC fell from a pre-Fed high of $43,762 to a session low of $42,304 in response to the Fed Rate Statement and Fed Chair Powell press conference.

Technical Analysis

Bitcoin Analysis

BTC remained above the 50-day and 200-day EMAs, sending bullish price signals.

A BTC break above the $42,968 resistance level would support a move toward the $44,690 resistance level.

On Thursday, the US economic calendar and BTC-spot ETF market net flows for Day 14 warrant investor attention.

However, a break below the 50-day EMA would give the bears a run at the $39,861 support level.

The 14-Daily RSI reading, 48.94, indicates a BTC fall to the $39,861 support level before entering oversold territory.

Ethereum Analysis

ETH sat below the 50-day EMA while holding above the 200-day EMA. The EMAs sent bearish near-term but bullish longer-term price signals.

An ETH break above the $2,300 resistance level and the 50-day EMA would support a move toward the $2,457 resistance level.

Investors must monitor ETH-spot ETF-related news.

However, a drop below the $2,200 handle would bring the $2,143 support level into play.

The 14-period Daily RSI at 42.98 suggests an ETH fall to the $2,143 support level before entering oversold territory.