Outflows from 11 U.S. ETFs Totaled $563.7 million, the Largest Number since the ETFs Began Trading. What’s Next?

On Labor Day, May 1, the U.S. Federal Open Market Committee held its regular meeting and again left interest rates unchanged in the range of 5.25% to 5.5% In doing so, Powell made it clear to the market that any interest rate cut will probably not be discussed in the coming months due to still-high inflation. However, the cryptocurrency market reacted contrary to expectations, increasing losses.

The reason for this was the continued outflow of funds from Bitcoin ETFs, for which the largest Bitcoin-ETF underwriter BlackRock held a meeting with investors over the weekend. The interest rate decision did not neutralize the negative aspects of Bitcoin ETF outflows. The debut of the Bitcoin ETF on the Hong Kong exchange did not meet expectations and did not generate much optimism.

Meanwhile, yields on 10-year and two-year U.S. Treasuries fell, as did the U.S. dollar index (DXY). Shortly after Federal Reserve Chairman Jerome Powell announced that interest rates would remain unchanged, Bitcoin briefly soared from $57,000 to nearly $59,400. But in the absence of buying volume support, it quickly reverted to its previous value and is currently trading at around $58,600 (May 2nd, 3:15 pm CET).

Widely cited on the Web, CoinGlass data showed that cumulative outflows from 11 U.S. ETFs totaled $563.7 million, the largest outflow since the ETFs began trading on Jan. 11. Bitcoin fell nearly 10% to its weekly low this week. Other major cryptocurrencies fell 7 to 15% for the week. Investors should even more scrupulously focus on ETF fund flow data, as well as the derivatives (futures) markets, in order to seek their reentry points.