Why is the crypto market up today?

The cryptocurrency market is up today, thanks to an increase in spot BTC ETF inflows and a strengthening technical setup that drew bullish investors back into the trading scene.

The cryptocurrency market is up today, with the entire market capitalization increasing by about 0.8% over the last 24 hours to $2.28 trillion on June 27. The crypto market is experiencing growth due to continuous inflows into U.S. spot Bitcoin exchange-traded funds (ETFs) and a strengthening market structure. Top-ranking coins such as Bitcoin ($61,495) and Ether (ETH) have contributed significantly.

Investors return to spot Bitcoin ETFs

The crypto market’s sustained advances are consistent with the restart of inflows into US-based spot Bitcoin ETFs. As of June 26, these funds managed around $52.61 billion in BTC, up from $47 billion at the beginning of May.

Farside Investors data shows that after seven days of consecutive outflows from these investment products, spot Bitcoin ETF capital flows have turned positive over the last two days, with net inflows of $31 million and $21.3 million on June 25 and 26, respectively.

Meanwhile, VanEck, one of the first to launch spot Bitcoin ETFs in the United States, has applied for a new Solana ETF.

VanEck, which also filed the first Ethereum ETF in 2021, may be signalling a larger trend, as the recent approval of spot Bitcoin and Ethereum ETFs could pave the way for future crypto ETFs in the United States. This development demonstrates the growing acceptance and adoption of Bitcoin and other cryptocurrencies in the traditional financial industry, which is boosting the crypto market’s worth today.

Higher Real GDP print boosts risk appetite

Markets began to show positive emotions as the United States’ first-quarter GDP came in a little higher than predicted at 1.4%. According to a report issued by the Bureau of Economic Analysis on June 27, this is the worst quarterly growth since spring 2022. In the fourth quarter of 2023, real GDP expanded by 3.4%.

The US Commerce Department originally predicted that GDP—the economy’s entire output of goods and services—would rise by 1.3% between January and March. At the same time, consumer spending fell faster than expected, and the Federal Reserve remains focused on the possibility of decreasing interest rates to control inflation.

The US economy has shown resilient in the face of rising interest rates. To combat the greatest inflation in 40 years, the Federal Reserve hiked its benchmark rate 11 times in 2022 and 2023, reaching a 23-year high. Most analysts who previously projected four interest rate decreases in 2024 are no longer fully pricing in a rate cut before September.

The crypto market sees a technical rebound

From a technical standpoint, today’s advances in the cryptocurrency market are part of a rebound that began at a support confluence that included the major support at $2.172 trillion and the middle limit of a descending parallel channel.

During the June 27 recovery, the overall market capitalization of $2.23 trillion broke above the top threshold of the channel, indicating a break out of the downtrend. As a result of this technical formation, the crypto market may increase to the $2.56 trillion level, which is embraced by the upper tip of the descending channel. Before attaining this, the total market capitalization must overcome supplier congestion in the $2.30 trillion to $2.35 trillion range, which includes all of the main EMAs.

Buy and sell crypto in minutes with 0.20% trading fees at Bitdenex  Exchange.