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Key Insights:
- Bitcoin retreats to $105K after topping $111K last week.
- Spot Bitcoin ETFs record first net outflow day in two weeks.
- Analysts expect Q3 rebound despite legal and macro uncertainties.
Bitcoin (BTC) dropped to $105K after reaching a record $111K, as ETFs logged rare outflows. Analysts see this as a consolidation phase rather than a crash, with major investors accumulating assets at lower prices. Many expect Q3 to pave the way for the next big rally.
Bitcoin cools after all-time high as ETF flows flip negative
BTC price retreated below $106,000 on May 29 after peaking at $111,970 just a week earlier. The pullback happened as spot Bitcoin ETF flows shifted. This ended a 10-day inflow streak, resulting in $347 Million in net outflows.
According to CoinGlass, it marked the most significant daily withdrawal since March 11. Fidelity’s Wise Origin Bitcoin Fund led the outflows with $166 Million, and Grayscale’s GBTC with $107.5 Million. Funds from Ark 21Shares, Invesco, and VanEck followed suit.
BlackRock’s iShares Bitcoin Trust (IBIT) stood as the outlier. It recorded a $125 Million net inflow on the same day, pushing its consecutive inflow streak to 34 trading days. IBIT has absorbed just under $4 billion in the past two weeks alone.
ETF Store president Nate Geraci noted that $9 billion flowed into spot Bitcoin ETFs over the past five weeks, compared to nearly $3 Billion outflows from gold ETFs in the same period.
Despite the ETF setback, BTC has remained at 11.59% over the past 30 days, CoinMarketCap data shows. Bitcoin last traded at $105,802 at press time.
Bitcoin enters healthy consolidation, not downturn
The recent pullback of Bitcoin may not signal a bearish reversal, according to Derive founder Nick Forster. Instead, he described the move as a “healthy pause” that allows the market to “digest recent gains.”
“While the recent surge to over $111,000 was notable,” Forster said, “the current price action suggests consolidation rather than an imminent breakout.”
He believes the slowdown might lead to future growth due to economic and political shifts. He highlighted a recent court ruling on May 28. The ruling found that former President Trump overstepped his authority with broad tariffs.
This decision could have significant economic implications. The judgment briefly eased concerns about trade-induced inflation.
However, a follow-up ruling on May 29 allowed Trump to continue enforcing the tariffs under emergency powers during the appeal process. Forster said this sequence reduced immediate inflationary pressure, offering markets short-term relief.
“The immediate concern of trade-induced inflation has been alleviated,” he said, noting its impact on market sentiment and positioning.
Fed decision and Q3 seasonality loom over next BTC move
Forster also flagged the U.S. Federal Reserve’s June 18 interest rate decision as a key upcoming catalyst. He argued that it could tilt market sentiment and ETF behavior depending on its tone.
Historically, BTC has underperformed in the third quarter. Coinglass data shows an average Q3 return of just 6.03% since 2013. However, Forster suggested that 2025 might diverge from that pattern.
“The potential for favorable regulatory developments and continued institutional interest may support stronger performance in Q3,” he stated.
Spot Bitcoin ETF flows remain strong despite the brief outflow, with BlackRock’s IBIT leading the charge. In May alone, the fund received over $6.2 Billion in new capital. This has yet to be reflected proportionally in the spot price of Bitcoin.
Forster explained that this disconnect arises from the structure of ETF purchases. “ETF investments often involve institutional investors seeking exposure without immediate impact on spot market prices,” he said.
Smart money keeps buying as whale scoops $850M BTC
On May 29, crypto analyst MerlijnTrader posted that a whale had purchased 8,000 BTC worth $850 million. “Smart money isn’t waiting. They’re buying the dip,” the trader wrote.
Elsewhere, Captain Faibik shared a similar sentiment. He stated, “Time to trap the Bitcoin bears and send it back above $110K!”
The mood among some traders remains optimistic despite the recent cooling. Crypto trader Apsk32 still sees a 2025 target of $220,000 for Bitcoin. It aligns with researcher Sminston With’s broader forecast of $220,000 to $330,000 based on cycle extensions.
BTC price action reflects caution amid competing signals from courts, central banks, and institutions. But beneath the surface, capital flows and strategic accumulation hint at a potentially active third quarter.
Disclaimer
In this article, the views and opinions stated by the author or any people named are for informational purposes only, and they don’t establish investment, financial, or any other advice. Trading or investing in cryptocurrency assets comes with a risk of financial loss.
