Bitcoin dropped to $58,000 on Thursday before a mild rebound, marking its lowest level since late 2024, as persistent inflation and heavy ETF outflows pressured prices. The cryptocurrency traded near $59,000 on Friday, still below the key $60,000 level, while Ether hovered under $1,525.
Inflation data reinforces higher-for-longer rate outlook
Fresh U.S. data showed inflation remains elevated, strengthening expectations that the Federal Reserve will keep interest rates higher for longer. The Personal Consumption Expenditures price index rose 3.4% year-over-year in May, with headline inflation at 4.1%, driven partly by energy costs. Monthly core PCE increased 0.3%, signaling continued underlying pressure.
The Fed reinforced this stance at its June meeting, holding rates at 3.50%–3.75% and signaling the possibility of at least one more increase this year.
ETF outflows intensify selling pressure
U.S. spot Bitcoin ETFs recorded $696 million in net outflows on June 25, extending a six-day streak of redemptions. Ether ETFs followed a similar pattern, with $81.9 million leaving over the same period.
The broader trend has been significant. More than $4 billion exited Bitcoin ETFs in the second quarter of 2026, including $3.61 billion in June alone. This sustained selling has outweighed spot demand and pushed prices lower.
Derivatives expiry adds to volatility
Market pressure increased ahead of a major derivatives event, with roughly $10.6 billion in Bitcoin options expiring, representing around 37% of open interest. Most of these positions were bullish bets far above current prices, making them effectively worthless.
As a result, market makers who had hedged these positions were forced to sell Bitcoin, amplifying downside volatility. Analysts noted that Bitcoin remains below the $68,000–$70,000 gamma flip zone, keeping the market in negative-gamma territory where price swings can intensify.
Key support levels come into focus
The $58,000–$60,000 range is now seen as a critical support zone. A sustained break below it could trigger deeper losses, with some historical models pointing to potential downside toward $37,000–$43,000.
On the upside, Bitcoin would need to reclaim the $63,000–$65,000 range to signal that selling pressure is easing.
Market structure shows cautious positioning
Options data highlights a $60,000 put wall worth about $450 million, suggesting this level may act as a near-term floor. Meanwhile, Bitcoin’s dominance remains around 55%, indicating capital is rotating into larger, established digital assets rather than leaving the sector entirely.
Mixed signals from on-chain and sentiment data
On-chain metrics suggest the market has not yet reached a traditional cycle bottom. A four-year realized price risk/reward indicator remains above levels typically associated with troughs.
At the same time, sentiment has weakened sharply, with the Fear & Greed Index falling into “Extreme Fear.” Despite this, longer-term holders appear to be accumulating, indicating divergence between short-term pressure and longer-term positioning.
Outlook tied to flows and macro conditions
Analysts say the near-term direction will likely depend more on derivatives positioning and ETF flows than on macro data alone. Stabilization in flows and reduced volatility following the recent expiry could support a rebound.
For now, Bitcoin and the broader cryptocurrency market remain sensitive to interest rate expectations, fund flows, and shifting trader sentiment.
For deeper insight into rate moves and BTC volatility, explore what interest rates mean for Bitcoin now.
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