ETF flows mixed ahead of inflation data
Bitcoin traded near $64,100 on Saturday, having rebounded 2.6% over the prior week as traders positioned ahead of the US consumer price index report due at 8:30 a.m. ET on July 14. The figure represents a critical test for the cryptocurrency’s near-term momentum, according to CryptoSlate Editor-in-Chief Liam ‘Akiba’ Wright.
US spot Bitcoin ETFs took in a net $90.4 million on July 10, reversing losses of $180.2 million combined over the two prior sessions. The inflows offered modest support, though 24-hour trading volume remained 21% below recent averages, signaling incomplete conviction among buyers. Bitcoin futures open interest stood near $47.3 billion with short liquidations dominating the prior 24 hours.
Three CPI scenarios in play
The July 14 inflation reading will likely determine Bitcoin’s directional bias through mid-month. An upside surprise in CPI could prove the hardest test for the rebound: hotter-than-expected inflation would likely lift Treasury yields and the dollar index while raising Federal Reserve rate-hike probabilities. The two-year Treasury yield closed July 10 at 4.21% and the 10-year at 4.56%, both higher on the day.
An inline CPI result would leave the rebound dependent on continued ETF inflows and fund flows more broadly. A downside surprise, conversely, could help expectations for monetary easing recover, potentially supporting Bitcoin’s near-term rally.
Fed rate expectations and market pricing
CME FedWatch data shows a 64.6% probability that the Federal Reserve will hold its target rate in the 3.50% to 3.75% range at its July 29 decision, with a 35.4% probability of a quarter-point rate hike. Market pricing reflects a 50.9% probability of rates reaching 3.75% to 4.00% by September and an 18.8% probability of them climbing to 4.00% to 4.25% by that date.
On July 6, US spot Bitcoin ETFs had captured $266 million in inflows, with BlackRock’s IBIT accounting for $209 million of that total, underscoring the role of institutional vehicles in Bitcoin’s price dynamics during periods of macro uncertainty.
