Bitcoin Nears Two-Month Low as ETF Outflows Persist

Market analysis comment on behalf of Inki Cho Financial Markets Strategist Consultant at Exness.

Bitcoin came under renewed selling pressure on Tuesday, falling to nearly a two-month low as institutional withdrawals persisted. Spot Bitcoin ETFs recorded net outflows of USD 201 million on Monday, a third consecutive negative session, taking November’s total to USD 1.48 billion.

Corporate demand provided only limited support. Strategy bought 1,036 Bitcoins last week, at a value of USD 82 million, a modest amount relative to ETF redemptions. Bitcoin also failed to join the rebound in technology stocks yesterday, as risk aversion continued to weigh on the market, in addition to political uncertainty, as the Democratic victory in Congress has raised expectations of tighter oversight of digital assets.

Oil prices dropped on hopes of reduced tensions with Iran, easing inflation expectations. However, markets still price in an interest rate hike in December by the Federal Reserve, which can continue to weigh on non-yielding assets, while the prospect of tighter monetary policy from the ECB and the Bank of Japan keeps global monetary conditions restrictive.

Attention turns to upcoming economic data. A softer CPI reading could temper expectations of further tightening, push yields lower and ease pressure on Bitcoin, although a sustained recovery would likely require ETF flows to turn positive. A hotter reading could revive bets on further hikes and extend the sell-off.

Zaid Barem / ymm