Bitcoin spot demand weakens as new capital hesitates despite ETF inflows

1alt HD: ETF Turnaround Proves Insufficient to Trigger True Macro Bullish Turnaround for Bitcoin Traders

Bitcoin [BTC] was struggling to scale the $65k local supply zone. Since July 14, the spot Bitcoin ETF inflows have been positive. The injection of capital has not been enough to substantially elevate prices yet.

Crypto analyst ScenarioX noted a steady drop-off in the 30-day Bitcoin spot demand. The metric recovered to -80k BTC in early July, but has since deteriorated to -170k BTC, the analyst explained in a post on CryptoQuant Insights.

Despite decreased demand, prices have stayed relatively stable around $65k because of short-covering in the derivatives market. Easing short-term holder sell pressure was also a contributing factor.

AMBCrypto reported that the turnaround in ETF flows was not enough to confirm a bullish reversal. A reading of the short-term price structure highlighted the importance of the $67.3k local swing high.

Lack of new investors growth signals stabilization, not reversal

The Bitcoin New Investors metric remained near its yearly lows. It measures the share of capitalization concentrated among coins younger than 1 month [not moved in a month or less].

Crypto analyst Axel Adler Jr. used this metric to gauge new capital activity and short-term demand. The analyst observed a reading of 8.1, with the lower boundary at 7 and the upper at 50.

This meant an increase in new capital, but not in enough strength to point toward a BTC trend reversal.

Further evidence of a local stabilization instead of a reversal came from the short-term holder spent output profit ratio [STH SOPR]. The metric measures the average profitability of short-term Bitcoin holders.

Its 7-day moving average was at 0.99, below the 1.0 mark that separates profitability from realized losses.

A sustained recovery in the metric above 1.0 would signal market sentiment has shifted. As things stand, the lack of significant participation from new capital and short-term holders realizing losses meant that bears were still in control.

Final Summary

• Bitcoin has not yet found the momentum to take prices above the $65k-$67k local supply zone.
• The bounce toward $65k was only a brief respite from selling, and not the beginning of a bullish recovery, the metrics showed.