Bitcoin remained relatively steady during Tuesday's early trading session, hovering around the $64,650 mark as market participants turned cautious ahead of the Federal Reserve's two-day policy meeting. The leading cryptocurrency slipped roughly 0.7% from the previous close, trading within a narrow range of $64,416 to $65,598.
Institutional Demand Shows Signs of Fatigue
The primary concern among investors is the quality of demand supporting bitcoin's recent rebound. While the asset has managed to recover from earlier lows, institutional buyers have yet to fully confirm the rally. Data from Farside indicates that U.S. spot bitcoin exchange-traded funds (ETFs) attracted $499.1 million in net inflows between Monday and Wednesday last week, but this was largely offset by $465.2 million in outflows on Thursday and Friday. The result was a modest net inflow of just $33.9 million for the week.
This pattern suggests that new demand waned as bitcoin approached the upper end of its recent trading band. The shift in flow dynamics carries more significance than the headline weekly figure might imply. As of publication time, Farside had not yet released comprehensive flow data for July 27, and the Monday ETF figure remains provisional.
Strategy Remains on the Sidelines
Adding to the cautious tone, Strategy (NASDAQ: MSTR) did not acquire any bitcoin during the July 20 to July 26 period, marking the third consecutive week without a purchase. The company's holdings remain at 843,775 coins, with an average acquisition price of $75,476 per coin—approximately 17% above bitcoin's current market price. The halt in purchases removes a steady source of additional demand that had previously supported the market.
Macro Headwinds and Key Levels
Risk assets received an initial boost from Monday's macro environment, with Brent crude sliding over 8% as a halt in U.S.-Iran strikes fueled optimism for diplomacy. The U.S. 10-year Treasury yield slipped to 4.647%. However, bitcoin struggled to maintain levels above $65,000, indicating that while selling pressure was absorbed, the market lacked a significant new catalyst to drive a breakout.
Nicolai Sondergaard, senior analyst at Nansen, described the situation succinctly: "The market is holding range without strong buyers, not building toward a breakout." Open interest in bitcoin futures fell even as prices increased, reflecting scaled-back exposure rather than bold new positions.
Joel Kruger, strategist at LMAX Group, identified the primary breakout threshold at approximately $67,300, roughly 4.1% above current levels. A sustained move above this level, supported by renewed ETF inflows and increased futures open interest, would challenge the current negative scenario.
Upcoming Catalysts
The Federal Reserve opens its July meeting on Tuesday, with the policy announcement expected at 2 p.m. EDT on Wednesday, followed by a press conference at 2:30 p.m. In June, the Fed kept its target range at 3.50%–3.75%. Another key event arrives Thursday, when the Bureau of Economic Analysis publishes its advance second-quarter GDP figures and June personal income data at 8:30 a.m. EDT, along with the PCE inflation measures favored by the Fed.
Risks to bitcoin include a hawkish stance from the Fed, further ETF outflows, or new tensions involving Iran, which could drive the cryptocurrency closer to its June lows. Nansen notes a potential slide to the $52,000–$58,000 range unless demand picks up. For now, bitcoin's price remains stable, but a more convincing indicator of accumulation would be renewed cash demand, rather than just another short-lived rise above $65,000.
