Bitcoin price has bounced from oversold levels, but falling volume and weaker ETF activity suggest institutions aren’t rushing back in.
Bitcoin could still give back part of its latest rebound as Glassnode data suggest big investors still aren’t rushing to chase the move higher.
After bouncing off the $60,000 level due to option traders unwinding their negative exposure, the BTC▼$64,253.00 market continued showing weakening activity, which means that the recent rise should be considered merely the process of stabilization, analysts at Glassnode said in a June 15 report.
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As the analysts argued, Bitcoin’s move looks more like stabilization after a selloff than the start of a confirmed reversal.
The bounce came as the market kept getting thinner, with spot volume falling 40% to $5.8 billion and futures open interest dropping another 3% to around $30 billion, Glassnode said.
Institutions Still Aren’t Rushing Back
Activity around spot exchange-traded funds still remains weak. As Glassnode pointed out, ETF trade volume fell 38% to $11 billion, while net outflows narrowed from $1.3 billion to $465 million.
The analysts noted that ETF MVRV moved back above 1.0 to 1.06, suggesting ETF holders are no longer deeply underwater on average, but the flow picture still remains weak, with the analysts saying the market “is lighter, not healthier.” The analysts said:
“Capitulation intensity is fading, sentiment hedging is unwinding, and taker behavior has shifted constructively. But the absence of volume, the declining derivatives footprint, and ongoing capital outflows mean this is a consolidation base being built, not a confirmed reversal.”
On top of that, profitability remains stressed as only about 50% of BTC’s circulating supply is held at a profit, below the 55.1% lower band.
As Glassnode note, the market is witnessing declining capitulation and fear. Nevertheless, the market still lacks volume, derivatives activity and institutional participation in order to talk about a full recovery.
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