Investing.com– (BitfinexUSD) pushed towards the $73,000 level early Saturday, supported by a significant return of institutional appetite and a strong shift in risk orientation in global markets.
The digital asset found new momentum after a temporary ceasefire in the U.S.-Iran conflict sent crude oil prices tumbling, effectively reassessing inflation expectations and paving the way for possible easing by the Federal Reserve.
ETF inflows signal institutional yield
After a brief period of stagnation, spot Bitcoin ETFs saw massive net inflows of $358 million on Wednesday, a trend that analysts said continued throughout the week.
The resurgence in demand was led by BlackRock’s IBIT and the new Bitcoin Trust (MSBT), which saw $34 million in inflows on its first day earlier this week.
The institutional “reload” on Bitcoin follows two consecutive days of outflows and indicates a strategic pivot by fund managers who increasingly view Bitcoin as a high-beta play in a macro-stabilizing environment.
Bitcoin’s price action was also fueled by a massive short squeeze in the derivatives market. Data shows that the recent move above $71,000 triggered over $427 million in forced liquidations of bearish positions.
With roughly $6 billion in additional leveraged shorts clustered between $73,500 and $75,000, traders are bracing for a potential “liquidation cascade” that could catapult the cryptocurrency to new 52-week highs if current support levels hold.
Macroeconomic tailwinds and the “digital gold” narrative
Bitcoin’s 85% correlation with the Nasdaq-100 is on full display as oil price volatility decreases. As WTI crude prices have retreated from their January highs near $112 a barrel, the resulting drop in energy costs has shifted the odds of rate cuts in favor of more dovish central banks.
Accommodative environments have historically benefited “scarce” assets like Bitcoin, which currently operates with a reward of 3,125 BTC per block after the 2024 halving.
While long-term “halving cycle” patterns have come under scrutiny this year, the current rally appears to be driven by a bullish shift…
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