Key considerations:
-
Professional traders are cautious and are pricing in a low probability of Bitcoin reaching $78,000 despite recent ETF inflows.
-
The US-Israel-Iran war and soft US labor data offset momentum in Bitcoin ETFs.
Bitcoin Chances: 17% chance of breaking $78,000
Bitcoin (BTC) retook the $70,000 mark on Wednesday. However, repeated failed attempts to break above $74,000 over the past five weeks have raised doubts. The ongoing US-Israeli-Iranian war, combined with the disappointing number of US workers, only increased the cautious outlook.
Traders are now assessing whether the recent influx into Bitcoin exchange-traded funds (ETFs) signals an imminent breakout in the upside.
While U.S.-listed Bitcoin ETFs saw net inflows of $414 million between Monday and Tuesday, this was insufficient to offset the $576 million in net outflows recorded the previous Thursday and Friday.
Data from the derivatives market suggests that professional traders are skeptical of a significant rally before the end of the month.
Bitcoin call options on Deribit for March 27, which target a price of $78,000, sold for $704 on Wednesday. This pricing suggests that the sharks and market makers have less than a 17% chance of winning bitcoin from its current level of around 12%.
This cautious outlook is also reflected in the futures market, where demand for long compressed positions remains stagnant.
The annual premium (base rate) for monthly Bitcoin futures remained flat at 4%. Notably, the gauge remained unchanged even after a 16% four-day rally that peaked with a retest of $74,000 on March 4.
Current data onchain and its derivatives point to indifference rather than expecting a sharp crash.
The economic outlook offsets institutional BTC imports
Professional traders are wary of a steady rise in the price of BTC, mainly due to the deteriorating global economy.
Seema Shah, global chief financial officer at Principal Asset Management, said investors are more interested in how the conflict will affect inflation, according to Yahoo Finance.
Strategist Raymond James Tavis McCourt wrote on Monday that the $25 increase in oil prices would essentially offset the fiscal benefit from the Act as a nice bill, according to CNBC.
McCourt added that after the Gulf War in 1990 and the Russian invasion of Ukraine in 2022, it took about six months for oil prices to return to their previous levels.
The 92,000 U.S. jobs in February reported on Friday severely disappointed analysts, as the consensus had expected an increase of 55,000. Sentiment worsened on Monday after JPMorgan cut the cost of private credit loans to software companies, according to a Financial Times report.
Regardless of the economic outlook, yield products revolving around Strategy Shares (MSTR US) are increasingly supportive for the price of Bitcoin. The company announced a record average daily price and trading volume, offering the opportunity to issue shares in the market and use the proceeds to purchase additional Bitcoin positions.
related to: Price Predictions 3/11: BTC, ETH, BNB, XRP, SOL, DOGE, ADA, BCH, HYPE, XMR
User X “gumsays” that adopting the Variable Rate Perpetual Strategy (STRC US) will result in the Strategy buying billions of bitcoins per week.
The analysis added that a potential range of ETF inflows could lead to strong institutional demand. Therefore, traders will probably have to wait until after March for Bitcoin to breach $78,000.
This article does not contain investment advice or recommendations. Every investment and business move involves risk, and readers should do their own research when making a decision. While we strive to provide accurate and timely information, Cointelegraph does not guarantee the accuracy, completeness or reliability of any information in this article. This article may contain forward-looking statements that are subject to risks and uncertainties. Cointelegraph shall not be liable for any loss or damage arising from your reliance on this information.
