BTC selling pressure is mounting as US institutional investors offload their holdings, putting downward pressure on Bitcoin prices in October. The world’s leading cryptocurrency, which has hovered around $62,000, is facing a critical moment as both bullish and bearish forces compete for dominance.
BTC selling pressure is evident across multiple indicators, highlighting a concerning trend for the cryptocurrency’s short-term future.
BTC Selling Pressure: Coinbase Premium Index Stays Negative
One of the clearest signals of BTC selling pressure comes from the Coinbase Premium Index, a metric that tracks the price difference between Bitcoin on Coinbase, a popular platform for institutional investors, and Binance, a global exchange. Throughout October, the index has remained in negative territory, which suggests Bitcoin is trading lower on Coinbase than on Binance. This discrepancy indicates stronger selling pressure from US investors, especially institutions.
“The Coinbase Premium has fallen to -$41, signaling strong selling pressure from US institutions, noted on-chain analyst Maartunn.
Historically, when the Coinbase Premium Index is positive, it signals optimism, with prices typically rising soon after. Conversely, negative readings often correlate with declining prices, as is the case now. With the continuous negative trend throughout early October, many market watchers are worried about an impending correction.
Bitcoin ETF Outflows Point to Rising BTC Selling Pressure
Another data point supporting this growing concern is the recent outflows from US-based Bitcoin ETFs, reinforcing the narrative of increasing BTC selling pressure. In October alone, four out of the first six days recorded net outflows, with over $408 million being withdrawn. In contrast, only around $260 million flowed into ETFs since the start of the month. Recently, a wallet linked to BlackRock also recorded significant withdrawals.
As institutional outflows continue, the potential for a major BTC price decline becomes more likely, with investors closely monitoring ETF trends to gauge overall sentiment.
The UTXO Realized Price Distribution (URPD) tool, which analyzes the amount of Bitcoin traded at different price levels, shows that Bitcoin is currently in a sensitive price zone. According to Glassnode, a significant volume of Bitcoin has traded around the $62,600 level, making it a key support point.
If Bitcoin fails to hold around $62,600 and drops below $60,000, it could decline toward $52,000. However, Bitcoin could also quickly surge past $72,000 if it breaks through the resistance level at $64,000. $62,600 is a key level, and support below this price weakens significantly, Glassnode reported.
Should BTC break below $60,000, some analysts predict that the price could retreat to $52,000. On the flip side, if it manages to break through resistance at $64,000, Bitcoin could quickly surge past $72,000. This divergence illustrates the delicate balance Bitcoin faces under the current wave of BTC selling pressure.
Institutional investors wield significant influence over Bitcoin prices, and their sentiment can make or break momentum in the market. The recent increase in BTC selling pressure from these investors can be traced back to several factors, including macroeconomic uncertainty, regulatory challenges, and changes in market strategy.
Some institutional players may be taking profits after Bitcoin’s strong performance earlier this year, while others could be rotating their capital into alternative assets or holding off until clearer regulatory guidelines are established. Whatever the cause, the effect is clear: US institutions are actively selling, and that is weighing down Bitcoin’s performance in October.
We’re seeing a lot of short-term profit-taking from institutional traders,” said Matthew Hougan, CIO of Bitwise Asset Management. The ongoing regulatory concerns in the US are also creating a cautious atmosphere.
With BTC selling pressure intensifying, the short-term outlook for Bitcoin remains uncertain. While there are still bullish factors at play, such as the potential for ETF approval or renewed interest from retail investors, the immediate concern is whether Bitcoin can withstand the current wave of institutional selling. If it fails to maintain support above $62,600, a further decline could materialize, shaking confidence in the market.
However, some market participants remain optimistic, pointing to Bitcoin’s historical resilience during similar periods of high selling pressure. Should Bitcoin break through key resistance levels, such as $64,000, there is a strong chance for a rapid recovery toward $72,000 and beyond.
In conclusion, the increase in BTC selling pressure from US institutional investors has had a noticeable impact on Bitcoin’s performance this October. As indicated by the Coinbase Premium Index, ETF outflows, and sensitive price zone data, the cryptocurrency market is in a state of flux. The coming weeks will be crucial in determining whether Bitcoin can withstand this selling pressure or whether a more significant correction is on the horizon.
For now, investors should keep a close eye on key price levels and institutional activity, as these will likely dictate Bitcoin’s next move. With both bullish and bearish factors at play, October promises to be a pivotal month for BTC. Get more from The Bit Gazette
