Bitcoin (BTC) price is currently down 3% after a strong weekly gain last week. Here, Bitcoin’s daily chart shows a historically bearish pattern, raising concerns of another retest of the $60,000 level.
Bitcoin forms a downward trend every day.
Bitcoin’s 2.4% decline on October 21 formed a bearish pattern on the daily chart. A bearish absorption pattern indicates a short-term or long-term reversal, with a success rate of 60-70% depending on other market confirmations.
Bitcoin 1 day chart. Source: Trading View
Over the past seven months, each bearish engulfment pattern near the highs has been followed by a steep correction. The declines deepened each time, with prices falling 26% between July 29 and August 5.
However, the main bearish concern stems from another series of events that have had a direct impact on prices over the past few months.
Bitcoin’s futures and derivatives markets have played a significant role in BTC’s recent price action, with Bitcoin’s open interest exceeding $40 billion as the price rose to $69,000.
Bitcoin open interest, spot CVD delta and price charts. Source: X.com
However, negative spot order book CVD continues to plague Bitcoin, highlighting the lack of spot buyers on exchanges. As you can see from the chart, increased open interest, negative spot CVD, and an indirect correlation with bearish patterns generally lead to lower Bitcoin prices.
With this in mind and considering BTC’s history of corrections in previous setups, the drop to $60,000 is not abnormal.
Related: Bitcoin Benefits from Rising Hashrate, Inflation Concerns, and Crypto-Friendly President.
Spot Bitcoin ETF leaks $79 million
With the price failing to surpass $70,000 on October 21, Bitcoin institutional investors may have taken their foot off the pedal, with US ETFs recording outflows of $79.1 million on October 22.
Previously, net negative ETF inflows were observed on October 10 with outflows of $81.1 million.
Bitcoin ETF flow chart. Source: Farside.co.uk
From October 10 to October 22, a whopping $2.6 billion was added in inflows, bringing total AUM to a record high of $65 billion.
However, the current pause indicates that some institutions are potentially sidelined as BTC struggles at key resistance levels.
Related: Bitcoin Traders Expect Price Decline, But $73,000 Remains Near-Term Target
This article does not contain investment advice or recommendations. All investment and trading activities involve risk and readers should conduct their own research when making any decisions.