Bitcoin (BTC) price trades at $75,937 at the time of writing, following a 6% drop in just two days since November 5. The drop follows growing concerns of a massive selloff in the AI and tech sectors. The concerns have exacerbated outflows from spot BTC ETFs to multi-month highs.
The crypto market sentiment has dropped to extreme fear, prompting short-term holders to begin selling their BTC at a loss in fear of an even steeper decline. However, the falling exchange reserves are creating a bullish divergence.
Bitcoin ETF Weekly Outflows Hit $1.28B
Data from SoSoValue shows that there were $1.28 billion outflows from spot BTC ETFs in the week between November 2 and November 6. Zooming out shows that this is the highest weekly outflow that the ETFs have recorded since the week ending June 26.
The outflows come as investors reduce their exposure to risk assets because of concerns that the AI selloff might continue. As CoinGape reported, Maestrom co-founder Arthur Hayes had warned that a looming AI collapse may push BTC price lower.
Bitcoin ETFs have now recorded outflows for two straight weeks. However, they have held up better than Ethereum ETFs, which have recorded outflows for six straight weeks.
The outflows from these ETFs have a bearish effect on Bitcoin price. This is because it signals reduced demand for Bitcoin from institutions, which may rattle retail traders who may also rush to sell, causing the price to fall further.
Short Term Holders are Dumping BTC at a Loss
Data from CryptoQuant shows that short term holders are shifting from selling Bitcoin at a profit to selling at a loss.
The data shows that the amount of BTC in profit that his cohort has sent to exchanges has dropped from 29,849 BTC to 4,089 BTC. On the other hand, the coins that they are sending to exchanges that are sitting in losses have increased from 2,559 BTC to 32,695 BTC.
Per this data, the share of losses in their exchange inflows now stands at 89%. While the movement of coins to exchanges does not mean that they sold, it raises the possibility of selling pressure rising in the near term, causing Bitcoin price to drop further.
However, their behaviour has not caused an increase in exchange reserves. Data from CoinGlass shows that Bitcoin reserves have dropped from 2.6 million BTC on November 4 to 2.59 million BTC, suggesting that 10,000 BTC has left exchanges.
The falling reserves despite the ongoing price weakness suggest that the value of BTC has a chance to hold $75,000. However, if selling pressure increases, the king coin might lose this support level.
Bitcoin Price Prediction Signals $75K May Not Hold
The ongoing concerns around the AI sector cast a bearish future Bitcoin price outlook. If these concerns are exacerbated in the coming week, BTC may fail to hold the crucial support at $75,000.
Moreover, the weekly chart shows that Bitcoin has been creating a rounded top pattern. When this pattern emerges, it signals that the trend might be about to reverse to a bearish one.
If Bitcoin confirmed a weekly close below the support at $75,900, the bearish trend could gain strength and the price could drop to the 200-week EMA of $69,500.
On the upside, the resistance lies at the 100-week EMA of $78,900. If BTC can close above this resistance and hold $81,000, the price could move towards $85,000.
However, the odds of this move towards $85,000 remains limited on the weekly timeframe because the RSI line has dropped below 50 to suggest that bears are now in control.
The coming week might also fuel more volatility for Bitcoin price because of the release of the US inflation data.