- Published on
Bitcoin, Ether extend relief rallies as extreme fear meets renewed ETF buying
- Authors
- Name
- DeepHorus
Bitcoin and Ether extended their relief rallies on July 3, with Bitcoin briefly touching $62,950 and Ether outperforming the broader market to reach $1,775. The uptick came just days after Bitcoin fell to a 21-month low and Ether sank to fresh year-to-date lows, signaling a potential turnaround in sentiment. The Crypto Fear & Greed Index registered "Extreme Fear" at 11 out of 100, yet the market's recent price action suggests buyers are stepping in.
This divergence between extreme fear and bullish price movement is notable. On July 2, U.S. spot Bitcoin exchange-traded funds (ETFs) saw net inflows of $221.7 million, their largest single-day inflow since early May and a break from ten consecutive days of outflows. This renewed ETF buying indicates institutional interest may be returning after a prolonged period of selling pressure.
Futures markets also played a role in fueling the gains. Funding ratesâperiodic payments between long and short tradersâhave remained positive for eight consecutive days and have been climbing. The total amount of outstanding leveraged Bitcoin positions is near its highest level in several days, even as the price has mostly moved sideways, a pattern typically viewed as a cautious sign rather than a confirmation of a sustained rally.
Looking ahead, key price levels will determine whether bulls can maintain momentum. Bitcoin must hold above roughly $61,000, where a large cluster of leveraged buy positions sits. A move above $62,500 would expose leveraged short positions, potentially triggering further gains. Additionally, Wednesday's ETF inflow needs to be more than a one-off event to signal a lasting trend shift.
Market reactions remain mixed. While spot buying and ETF inflows suggest improving sentiment, the high level of leverage and extreme fear readings indicate fragility. Analysts caution that a market this deeply fearful and this leveraged toward higher prices tends to be more vulnerable to sharp reversals. The upcoming U.S. holiday-weekend stretch of typically thinner trading adds another layer of uncertainty.
Overall, the current setup is neither clearly bullish nor bearish. The rebound in ETF flows and dip buying could mark a bottom, but the persistent leverage and fear levels warrant caution. Traders will closely watch whether Bitcoin can sustain its rally through the weekend and whether ETF inflows continue to build on the recent positive momentum.
