Bitcoin ETF demand has cooled significantly, with net outflows reaching a record 10-day streak between May 15th and 29th, according to AMBCrypto data. The scale of recent withdrawals has intensified dramatically, with Bitcoin ETF outflows exceeding $2.96 billion during this period, highlighting a sharp shift in institutional sentiment as demand weakened. This represents a substantial decline from the $240 million in net inflows recorded on April 10, marking one of the highest single-day flows in recent months. The BlackRock IBIT ETF led with $2.11 billion in maximum outflows over the 10-day period, followed by Fidelity's FBTC, while Morgan Stanley's MSTB recorded $5.4 million in outflows despite being relatively new to the market. Many asset managers observed zero flows during these ten days, indicating selective selling pressure concentrated among specific institutional players.
Bitcoin has recovered to $73,807.36 as of the latest data, successfully reclaiming the critical $73,000-$74,000 support zone after falling below the $80,000-$82,000 range. However, the latest price action shows Bitcoin has started a downside correction from the $77,800 zone and is now showing bearish signs and might continue lower below $75,500. This occurred when the price of Bitcoin was trading at $80K and then dropped to $73K, with ETF withdrawals being identified as the cause of the price decline. Recent price action showed sellers pushing BTC lower from the $81K region, bringing the asset back toward a key demand area. Technical indicators reflect growing downside exhaustion, with the Stoch RSI dropping to 0.45 and 1.36, placing both readings deep in oversold territory after the recent decline. However, the chart also highlights resistance at $77,732, followed by a stronger barrier near $82,568.
Despite the growing ETF-driven selling pressure, spot market participants continued showing resilience with the 90-day Spot Taker CVD remaining in a 'Taker Buy Dominant' state. This divergence created an interesting market dynamic because institutional capital moved out while spot traders continued accumulating, often reflecting confidence among shorter-term participants who viewed lower prices as opportunities rather than risks. The continued presence of taker buyers suggests that selling pressure had not completely overwhelmed demand, with buyers stepping in underneath to absorb available supply. However, this behavior pattern also indicates that institutional capital is moving out while retail demand remains relatively stable, creating a mixed market structure that could amplify volatility during broader market shifts.
Long-term holder supply has reached a record 15.8 million BTC, according to CryptoQuant, normally a bullish signal because it reflects coins held rather than traded. However, the firm argues this record may be hollow, reflecting slowing market turnover rather than conviction. Short-term holder supply has fallen about 2.2 million BTC since December, including roughly 900,000 BTC of Coinbase reserves that crossed the 155-day long-term-holder threshold by sitting still. The record supply figures are partly an artifact of inactivity, not fresh buying. Despite the Bitcoin ETF inflows, market structure remains weak with mixed derivatives indicators creating volatility risks, as large speculators are heavily net long while commercial traders remain net short. On-chain data reveals another concerning trend with Bitcoin's NVT Ratio climbing 21.81% to 23.24, indicating that market value increased relative to transaction activity, suggesting that network usage failed to keep pace with valuation growth.
Despite bearish on-chain data showing apparent demand at its weakest level since December, technical signals remain mixed with the Parabolic SAR continuing to print above price, indicating that bearish control remains intact. If buyers defend $73K successfully, Bitcoin could attempt a recovery toward $77.7K. However, the Swissblock's Risk Index continues to measure structural selling pressure against absorption, with the index remaining in high-risk territory as ETF demand fails to absorb selling pressure effectively. The combination of weakening ETF demand and rising NVT Ratio reinforces the view that Bitcoin's recovery still lacks broad participation, with stronger transaction activity likely needed to improve the outlook and support a more sustainable rebound. At the same time, the OI-Weighted Funding Rate for Bitcoin was rising and very positive, indicating that most traders were paying funding fees to short sellers and opening long positions, suggesting potential for a long squeeze if buyers do not intervene.
