Why is Bitcoin losing strength? Is it being pushed aside by the AI and semiconductor rally?

▲ Bitcoin (BTC) ©CoinReaders

Bitcoin (BTC) is facing the risk of collapsing below $70,000. As institutional funds withdraw from Bitcoin spot ETFs and premium indicators in the US and Korean markets turn negative, analysis suggests that investor sentiment in the cryptocurrency market is rapidly cooling, overshadowed by the AI and semiconductor rally.

According to investment media outlet FXStreet on June 1 (local time), Bitcoin has fallen below $73,000 amid a decline for three consecutive weeks. The outlet cited the withdrawal of $2.43 billion in funds by institutional investors from Bitcoin spot ETFs over the past month as a key bearish factor. Furthermore, with cryptocurrency premium indicators in the US and Korean markets turning negative, analysis suggests that individual investor demand is also weakening.

According to CoinGlass data, the net asset value of Bitcoin spot ETFs decreased from $100.53 billion in April to $94.17 billion in May. Notably, a net outflow of $1.42 billion occurred last week alone, marking three consecutive weeks of outflows exceeding $1 billion. This represents the largest monthly net outflow this year. The outlet analyzed that institutional fund flows have now become a critical variable determining Bitcoin's price.

A slowdown in demand in the US and Korean markets was also confirmed. According to CryptoQuant data, the Coinbase Premium Index, which reflects US individual investor demand, fell to -0.13. The Korea Premium Index, reflecting Korean market demand, also dropped to -2.29, marking its lowest level since December 2024. The outlet analyzed that investment funds are moving from the cryptocurrency market to the stock market due to the ongoing rally in AI and semiconductor-related stocks.

The technical trend is also unstable. Bitcoin is currently testing the lower end of its short-term trading range between $72,582 and $74,590. If it breaks below $72,582 during the day, further declines to the uptrend line support area of $71,300 and the April 12 low of $70,505 are possible. Subsequent major support levels are suggested at $65,000 and $60,000.

The outlet diagnosed that Bitcoin is moving below key Exponential Moving Averages (EMAs), maintaining a short-term bearish structure. The daily chart's Relative Strength Index (RSI) has dropped to 34, attempting to enter the oversold zone, and the Moving Average Convergence Divergence (MACD) continues its negative trend below the signal line and baseline. Conversely, on the upside, the recovery of the 50-day and 100-day EMAs at $76,087 and $76,629, respectively, was presented as a key condition for a short-term rebound.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*