Bitcoin continues to demonstrate resilience, trading above $106,000 midweek after a 5% rally over the past two days. This upward momentum is largely attributed to robust institutional interest and a steady stream of inflows into spot Bitcoin ETFs, signaling growing confidence among major market players.
Institutional Buying and ETF Inflows Fuel the Rally
Recent days have seen a wave of corporate and institutional accumulation. Notably, ProCap BTC LLC, led by Anthony Pompliano, acquired 3,724 BTC in a single day following a $1 billion merger announcement and a $750 million fundraising round. Other public companies, including Strategy, Metaplanet, and the Blockchain Group, have also added Bitcoin to their treasuries, reinforcing the narrative of Bitcoin as a strategic reserve asset.
Spot Bitcoin ETFs have maintained an 11-day streak of positive inflows, with $588,55 million entering the market on Tuesday alone. Data from SoSoValue and K33 Research highlight that ETF flows are a primary driver of Bitcoin’s price action, with a strong correlation ((R^2 = 0,80)) between ETF inflows and BTC returns. In contrast, direct treasury acquisitions by companies have shown a much weaker relationship with price movement, often due to in-kind share exchanges that do not impact market liquidity.
Total Bitcoin Sport ETF net inflow daily chart. Source: SoSoValue
Macro Factors: Fed Policy in Focus
Market participants are closely watching the U.S. Federal Reserve, as Chair Jerome Powell’s recent testimony emphasized a cautious, data-driven approach to interest rate policy. While Powell indicated that the Fed is not rushing to cut rates, any dovish signals or favorable macroeconomic data could further boost risk assets like Bitcoin. Conversely, a more hawkish stance could temper the current rally.
Technical Outlook: Eyes on All-Time Highs
Bitcoin rebounded sharply from a recent low of $98,200, closing above its 50-day Exponential Moving Average (EMA) at $103,352 and currently trading near $106,500. Technical indicators support the bullish case: the daily Relative Strength Index (RSI) stands at 54, above the neutral 50 mark, and the MACD is on the verge of a bullish crossover, which could trigger additional buying interest.
Should the upward trend persist, Bitcoin may target its May 22 all-time high of $111,980. However, a close below the 50-day EMA could see the price retest the $98,200 support level.
Market Context and Forward-Looking Projections
Analysts forecast that sustained ETF inflows and institutional demand could propel Bitcoin toward new highs in the coming months. Price predictions for June and July 2025 suggest potential moves toward $113,500 and beyond, provided key support levels hold and macroeconomic conditions remain favorable 3.
