BlackRock’s Bitcoin ETF Records Highest Trading Volume Since November

TLDR

BlackRock’s spot Bitcoin ETF (IBIT) saw its highest trading volume since mid-November
IBIT dropped over 11% last week, falling to $46.07, the lowest since early November
Investors withdrew more than $1 billion from the ETF
IBIT broke below the $50.69 support level, signaling more potential losses
Despite outflows, IBIT remains the largest ETF globally with $39.6 billion in assets under management

BlackRock’s spot Bitcoin ETF (IBIT) experienced its highest trading volume in three months last week. The increased activity came alongside a significant price decline and substantial outflows from the fund.

The ETF’s price dropped over 11% last week. This decline pushed IBIT below the key January support level of $50.69, according to data from TradingView.

IBIT eventually fell to $46.07 during the week. This represents the lowest price point the fund has reached since early November of last year.

Trading volume surged dramatically during this price decline. Over 331 million shares of the ETF changed hands throughout the week.

This level of trading activity hasn’t been seen since mid-November. The surge in volume began last Tuesday when IBIT broke below the horizontal support level.

For market watchers, this combination of falling prices and high volume could be concerning. Traditional market wisdom suggests that price movements gain credibility when backed by high trading volumes.

Investor Behavior

The heavy selling was also reflected in fund flows. Data from Farside Investors shows that more than $1 billion was withdrawn from the ETF during this period.

The outflows came as investors reacted to both the price slide and dwindling CME futures basis. The futures basis represents the return on carry trades in the market.

IBIT wasn’t alone in experiencing withdrawals. The other ten U.S.-listed Bitcoin ETFs also saw money flowing out during this period.

Despite these recent challenges, IBIT maintains its position as the world’s largest ETF. The fund still holds $39.6 billion in assets under management.

Technical analysts note that the outlook for IBIT remains bearish. This negative outlook is expected to continue while prices stay below the former support level of $50.69.

This level has now transformed into a resistance point. Traders will be watching to see if IBIT can reclaim this price level in the coming weeks.

The recent price action comes amid broader volatility in cryptocurrency markets. Bitcoin itself has experienced price swings during the same period.

Trading volumes typically reflect market sentiment and participation levels. The high volume seen in IBIT suggests active repositioning by both institutional and retail investors.

Market participants will be closely monitoring IBIT’s performance in the coming weeks. The fund’s price action and flow data serve as important indicators for the broader Bitcoin market sentiment.