Bitcoin Price News: ETF Inflows Finish the Week In Green – Has The Recovery Started?

Bitcoin (BTC) went down by 2.4% in the past week and once again fell below the $90,000 mark, but investors seem to be ready to come back to the market after weeks of high volatility.

Data from Farside Investors shows that BTC-linked exchange-traded funds (ETFs) received $287 million last week, marking a significant shift from previous weeks, where net inflows swung from positive to negative territory.

This could be an early indication that the worst of the downturn is over, which means that BTC could be ready to make a comeback as market conditions and sentiment have started to improve.

Market Sentiment Improves as BTC Bounces Off $80K

Crypto’s Fear and Greed Index remains in Fear territory at 24 but has recovered from a recent record low of 11, back when the price of BTC plummeted near $80,000.

Fear and Greed Index – Source: CoinMarketCap

As we have highlighted multiple times in previous predictions, extreme lows in the F&G like this one tend to confirm that a local bottom is in.

The last time this happened was in April, back when the price dropped near the $70,000 mark. Back then, this sentiment gauge hit a low of 15 twice, and then the market started to recover and, shortly afterward, BTC made a new all-time high.

This contrarian behavior is consistent with how the “smart money” moves as deep-pocketed investors tend to frantically buy “when there’s blood in the streets”.

If Bitcoin starts to recover in the next few weeks and manages to recapture key levels like the $100,000 threshold, the odds that we will make it back to the highs we saw in October will dramatically increase.

Saylor Bought the Dip

Just today, Strategy, the digital asset treasury (DAT) run by Michael Saylor, bought another 10,645 BTC tokens, bringing the total held by this company to 671,268 BTC.

Strategy’s stash is now worth over $60 billion, meaning that the firm is sitting on unrealized gains of nearly $10 billion. In December alone, Saylor’s DAT acquired nearly $2 billion worth of BTC, increasing its total holdings by around 3.4%.

Open Interest in BTC Futures – Source: CoinGlass

Paired with these bullish catalysts, open interest in Bitcoin futures is also improving. After hitting a bottom at around 631,000 BTC, an uptrend in traders’ participation in the futures market is now visible.

This means that market participants could already be starting to shake off the hangover from the October 10 flash crash and may be getting ready and positioning their trades for BTC’s next leg up.

To sum up, these are four potentially bullish catalysts to consider that favor a positive short-term outlook for BTC:

1. Positive ETF inflows are growing.
2. The Fear and Greed Index is recovering after hitting a record low (typically a contrarian “buy” signal).
3. Saylor bought millions worth of BTC in December as the price crashed again.
4. Open interest is recovering as traders seem to be coming back to the market.

BTC Needs to Climb Above Its 200-Day EMA to Start Recovering

Looking at the daily chart, BTC has bounced off a key trend line support in the past few days and could be ready to make a move toward the $92,000 resistance.

BTC/USD Daily Chart (Binance) – Source: TradingView

This has been a highly contested price level as it is in confluence with the 200-day exponential moving average (EMA).

If the price climbs above this key line, Bitcoin’s outlook will turn bullish as it will indicate a change in the direction of its long-term price trend.

The Relative Strength Index (RSI) just sent a buy signal upon climbing above the 14-day moving average. However, it still needs to rise decisively above the mid-line to confirm it.

If we get a breakout above the 200-day EMA, the first stop for BTC would most likely be $100,000, as this is an area of high liquidity and interest from both a psychological and technical standpoint.