Bitcoin (BTC) price maintains a mild recovery tone on Friday, bouncing off after a prolonged drop above its long-term support area at $65,400. Spot Bitcoin exchange-traded funds (ETFs) listed on US exchanges have seen continued inflows, supporting the sentiment of the flagship cryptocurrency to welcome its third week of net inflows.
As tensions between the US and Iran continue to grow, rising crude oil prices and new tariffs imposed by US President Donald Trump are reigniting fears of inflation, which have dampened appetite for riskier assets and limited Bitcoin's rally.
The institutional demand was positive despite the difficult macro environment. SoSoValue data shows that US spot Bitcoin ETFs saw $273.87 million in net inflows by Thursday. If Friday's figure continues to be positive, it marks the third week in a row of net inflows in the market.
The demand for purchases has been moderate compared to the high outflows in the middle of May to early July, but it has continued, indicating that institutional investors are making a gradual return to the market. Continued ETF inflows could provide an important cushion against downside risks if geopolitical uncertainty persists.
Senate Republicans in the United States have released a draft of the Digital Asset Market Clarity (CLARITY) Act, which has been shown to be the final version, potentially allowing the long-awaited bill on market structure for cryptocurrencies to be fast-tracked before the summer recess of the US Congress.
The new draft adds harsher ethics rules that would ban the President and high-ranking government officials, as well as their spouses, from issuing or sponsoring digital assets during their tenure as government officials that would benefit them financially. Officials would also have to sell crypto assets that meet the criteria or hold them in blind trusts, while the enforcement would be carried out by the DoJ through civil suits.
As lawmakers are expected to turn to the November mid-term elections this year after the summer break, early August may be the last realistic chance for the legislation to get moving. The CLARITY Act, if enacted, could be a major game-changer for Bitcoin, providing regulatory clarity and boosting investor trust and adoption in the digital asset sector.
Also Read: Bitcoin's ETF Rebound Could Be the Catalyst Bulls Needed
Bitcoin hovers above $63,800 on Friday, trading below its 50-day Exponential Moving Average (EMA) at $64,847, continuing a turnaround that is now pointing towards a bearish weekly closing. The path of least resistance for BTC targets the $60,000 psychological support level, followed by the June 25 low at $58,115.
The Relative Strength Index (RSI) has dropped to 48, suggesting the bearish trend is regaining strength as it moves below the neutral 50 level. On the other hand, the Moving Average Convergence Divergence (MACD) made a bearish cross this week, which makes selling the continuation more likely.
Looking up, the 50-day EMA at $64,847 remains a key resistance, where a bullish close could revive the recovery. A sustained closing above this level could target the $70,000 round figure, followed by the 200-day EMA at $73,040.
Bitcoin’s rebound is being limited by rising geopolitical tensions, higher crude oil prices, and renewed inflation concerns. These factors have reduced demand for riskier assets and kept BTC below its key moving averages.
According to SoSoValue, US spot Bitcoin ETFs recorded $273.87 million in net inflows by Thursday. Continued positive flows could mark a third consecutive week of inflows and provide support against further downside.
The CLARITY Act could establish clearer rules for the US digital asset market. Greater regulatory certainty may improve institutional confidence, encourage adoption, and reduce legal uncertainty across the cryptocurrency sector.
The first major downside target is the psychological $60,000 level. A break below it could expose Bitcoin to the June 25 low near $58,115, where buyers may attempt to defend the market.
Bitcoin must reclaim the 50-day EMA at $64,847 to strengthen its recovery. A sustained close above this level could open the way toward $70,000, followed by the 200-day EMA near $73,040.
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