Yesterday, Bitcoin ETFs saw a staggering $870 million worth of inflows as the cryptocurrency’s price got precariously close to setting a new all-time high. BlackRock’s iShares Bitcoin Trust (IBIT) experienced a remarkable $3.36 billion in trading volume yesterday—the highest it’s been in the past six months. At the time of writing, the IBIT fund manages $17.2 billion worth of Bitcoin, according to Coinglass.
However, it’s not typical for ETF volumes to spike when the price is rising, Bloomberg Intelligence analyst Eric Balchunas stated on Twitter. “Typically ETF volume spikes in a downturn/crisis,” he noted, adding that yesterday’s significant uptick is more likely due to some institutional FOMO—fear of missing out.
And it’s easy to understand why. In the past 24 hours, the Bitcoin price came within $175 of setting a new record above its previous all-time high of $73,737.94 on March 14. At the time of publication, Bitcoin is currently trading at around $71,740, up 0.8% on the day, and 8.1% on the week, according to data from CoinGecko.
Currently, traders are focusing on the upcoming U.S. nonfarm payroll, or NFP, report set to be released on Friday. It’s a key economic indicator that would heavily influence whether the Federal Reserve considers lowering interest rates once again, according to Singapore-based crypto trading firm QCP Capital. “This week’s spotlight is on Friday’s NFP report, a critical indicator of U.S. job market health, with consensus estimates around 110k — approximately half of the previous figure,” the firm wrote in a trading note on Wednesday. “As the final major data release before next Friday’s Fed meeting, the report is expected to lock in market bets for the Fed’s next move.”
Those bets, as captured by the CME FedWatch Tool, indicate that 99.6% of traders expect the Federal Reserve to cut rates again, lowering them by 25-50 basis points. In the near term, however, investors are monitoring today’s gross domestic product report from the Bureau of Economic Analysis. The report shows that the U.S. GDP increased by 2.8% in the third quarter, a slight slowdown from the 3% reported in Q2.
“Bitcoin appears to have entered an acceleration phase, aligning with expectations around the presidential election and other favorable catalysts,” wrote BRN analyst Valentin Fournier, noting the GDP release. “With Bitcoin nearing its ATH, strong resistance may present a challenge, but the current momentum and favorable catalysts could drive an ATH breakout. We recommend staying heavily invested, with a preference for Bitcoin over Ethereum.”
Edited by Stacy Elliott.