Bitcoin (BTC) failed to hold above $110,000 after an earlier sentiment-driven rally lifted cryptocurrency prices broadly. The largest crypto asset by market capitalization continued to lose momentum over the past two days and was trading around $107,399 at the time of writing.
Major altcoins, including Ethereum (ETH) and Ripple (XRP), which previously flashed bullish signals alongside BTC, are now showing signs of weakness amid growing bearish bias. According to a recent "Ahead of the Curve" report from K33 Research, this sluggish price action is primarily characterized by a lack of risk appetite, with market sentiment remaining notably cautious.
Data Insights: ETF Inflows Surge Amid Price Weakness
Institutional sentiment remained relatively upbeat following the conclusion of recent trade negotiations between the US and China. This positively influenced spot exchange-traded fund (ETF) inflows, even as retail interest waned.
According to data from SoSoValue, daily net inflows into Bitcoin spot ETFs totaled approximately $165 million on Wednesday, significantly lower than Tuesday’s $431 million. BlackRock’s IBIT led other ETF products with $131 million in inflows, followed by VanEck’s HODL with $15 million.
Institutional interest in Ethereum has remained steady since mid-May, with ETH spot ETFs recording inflows for 17 consecutive days. On Wednesday, inflows into these regulated products—which allow investors to gain exposure without holding the actual tokens—jumped to $240 million, up from $125 million the previous day. The consistent rise in ETF inflows suggests strong investor confidence in Ethereum’s price potential.
Market Analysis: Bitcoin’s Uptrend Under Pressure
Bitcoin hovered near its all-time high of $111,980 earlier in the week, but underlying market sentiment remains concerning, likely due to macroeconomic uncertainties.
"Funding rates and leverage metrics across platforms point to persistent defensiveness, with Binance’s BTC/USDT perpetual seeing negative funding on a daily basis late last week and over the weekend," an analyst from K33 Research noted. "Over the past week, the average funding rate annualized stood at just 1.3%—a level seen only near local bottoms over the past 2.5 years," the analyst added.
Meanwhile, open interest (OI) in Bitcoin futures contracts has remained relatively low in recent weeks, dipping since BTC reached its record high. As shown in CoinGlass data, OI stands near $74 billion, down from approximately $80 billion on May 23rd.
Open interest refers to the total number of outstanding derivative contracts that have not been settled. Low or declining OI suggests reduced trader engagement, which—coupled with weakening volume—can hinder further price appreciation.
The path of least resistance is gradually tilting downward, especially as the Relative Strength Index (RSI) declined from a recent high of 64 toward the neutral 50 level on the daily chart. Traders are watching for a confirmed sell signal from the Moving Average Convergence Divergence (MACD) indicator to confirm bearish momentum. Such a signal occurs when the blue MACD line crosses below the red signal line.
Crypto investor and analyst Michaël van de Poppe noted on X that a pullback is likely, given Bitcoin’s inability to sustain strong support above $110,000. He added that as long as BTC holds above the $106,000 support level, investors need not worry.
That said, it’s wise to be prepared for a test of the next major support—the 50-day Exponential Moving Average (EMA) near $102,472, which sits about 4.6% below the current price.
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Altcoin Update: Ethereum and XRP Flash Bearish Signals
Ethereum, the largest smart contract token by market cap, was trading at $2,747 at the time of writing—down nearly 1% on the day and 4.6% below Wednesday’s high of $2,881.
The pullback may extend, particularly if traders act on the sell signal confirmed by the MACD indicator on Thursday. Although the RSI remains in neutral territory at 56, it has retreated from overbought levels, suggesting that bulls may be losing conviction.
Key support levels traders are monitoring include the 4-hour 50-EMA near $2,646, the 100-EMA at $2,597, and the 200-EMA at $2,488. These could serve as potential buffers if selling accelerates.
XRP, on the other hand, remains below the 4-hour 50-EMA, which converges with the 100-EMA around $2.25, forming a confluence resistance zone. A break above that level would encounter further resistance near the 200-EMA at $2.26.
The MACD sell signal suggests a continuation of the downtrend. With the red histogram bars expanding below the baseline (0.00), downward pressure could intensify in the coming trading sessions.
Key downside targets for XRP include $2.19 (about 2% below the current price) and $2.07 (roughly 7% below current levels). Despite limited upward momentum, institutional adoption and interest in the cross-border payment token continue to grow.
Frequently Asked Questions
What is open interest in crypto trading?
Open interest refers to the total number of active derivative contracts, such as futures or options, that have not been closed or settled. Increasing OI typically signals new money entering the market and often aligns with trend continuation. Declining OI may indicate that traders are closing positions, which can precede a trend reversal or period of consolidation.
How do funding rates affect cryptocurrency prices?
Funding rates are periodic payments between long and short traders in perpetual swap markets. Positive funding rates indicate that longs are paying shorts, reflecting bullish sentiment. Negative rates suggest bearish sentiment. Extremely high or low funding rates can signal market overheating and often precede short-term reversals.
Why are ETF inflows important for Bitcoin and Ethereum?
ETF inflows represent demand from institutional investors and traditional finance participants. Consistent inflows can signal long-term confidence and contribute to price stability or appreciation. Conversely, outflows may indicate profit-taking or loss of confidence, potentially leading to downward price pressure.
What key support levels should Bitcoin traders watch?
In the near term, Bitcoin must hold above $106,000 to avoid a deeper correction. If that level fails, the next major support is the 50-day EMA near $102,472. A break below that could trigger further selling toward $100,000 or lower.
Can altcoins like Ethereum and XRP decouple from Bitcoin’s trend?
While short-term decoupling is possible, most major altcoins remain correlated with Bitcoin over longer periods. Ethereum occasionally shows independent momentum due to ecosystem-specific developments, but broad market sentiment still heavily influences its price action.
How can traders use RSI and MACD indicators effectively?
The RSI helps identify overbought or oversold conditions, with readings above 70 suggesting overbought levels and below 30 indicating oversold conditions. The MACD measures trend momentum and direction. A crossover above the signal line is bullish, while a crossover below is bearish. Using both together can provide stronger confirmation for entry or exit signals.