The price of Bitcoin has increased, surpassing $100,000 following the rise in US CPI figures. Despite this, institutions are buying back their BTC spot ETF shares.
Bitcoin .cwp-coin-chart path svg { stroke: ; line width: ; }
Price
Trading volume in 24 hours
Last price movement over 7 days
has been hectic this week. The good news is that prices are holding at the upper end of this month’s price range, a bullish indicator.
After a worrying drop below $90,000 at the start of the week, prices rebounded strongly on Wednesday, January 15, surpassing $100,000 for the second time this month.
The last time this was published was early last week, when prices soared to $102,000 before dropping sharply to $91,000. Although prices are currently higher, it is unclear whether Bitcoin has fully recovered.
Interestingly, institutional investors appear skeptical of the uptrend despite Bitcoin’s recent gains. And their caution is understandable.
Inflation Data Drives Bitcoin Price Up
Bitcoin and financial markets are recovering unexpectedly in response to mixed economic data from the United States.
Yesterday, the Ministry of Labor announced that the Consumer Price Index (CPI) had increased rapidly in nine months, mainly due to rising energy costs.
However, even as inflation rises, underlying inflationary pressures appear to be easing. More importantly, core inflation is slowing, which is a positive sign.
The report follows the Labor Department’s revelation that the producer price index (PPI) rose more slowly than economists predicted.
Therefore, combining the slowdown in core inflation with the slower-than-expected PPI growth, analysts concluded that the economy could slow down and inflation could decline.
This suggests that the Federal Reserve, which took a hawkish stance at the December FOMC meeting, may not aggressively implement restrictive monetary policies in the first quarter of 2025.
Bitcoin is increasingly sensitive to monetary policy decisions, and its price may increase or decrease depending on the path chosen by the Federal Reserve.
The indication of a “warming” economy resonates positively with traders, fueling demand and ultimately pushing Bitcoin above $100,000.
Technically, the uptrend remains intact and as long as BTC trades above $90,000, prices will likely remain in a bull flag. Any break above $108,000 could propel the world’s most valuable cryptocurrency towards $120,000 as bulls double down.
(BTCUSDT)
Wall Street is skeptical about $100,000
Although traders are optimistic and momentum is picking up after prices surged above $100,000, institutional demand for spot Bitcoin ETFs is drying up.
According to Lookochain data, institutions appear to be buying back their shares.
(Source)
On January 15, more than 3,000 BTC worth $302 million were redeemed. Notably, BlackRock’s iShares also saw outflows of 2,274 BTC, or $224 million.
Additionally, on January 14, institutions continued to sell, withdrawing 2,244 BTC worth $216.1 million.
(Source)
The fact that the “big guys” are buying back their shares suggests greater hesitation on the part of institutional investors. With Bitcoin rallying and spot Bitcoin ETFs experiencing outflows, this may indicate that they are taking profits or moving funds into other assets, such as bonds.
This approach makes sense. After the November rally, the crypto market seemed overextended.
Along with continued market concerns, Wall Street may be cautious about over-committing amid continued economic uncertainties.
However, this outlook could change if Bitcoin continues to recover and exceeds $108,000.
EXPLORE: The dust settles following the XRP price drop: best presale to buy in 2024?
Join the 99Bitcoins News Discord here for the latest market updates
The post Bitcoin Reclaims $100,000 on Inflation Data, But the Big Boys Aren’t Convinced appeared first on 99Bitcoins.
