$6.34B ETF Inflows Fuel Bitcoin Price Surge Amid Short Squeeze

In Q3 (July-September), US spot Bitcoin ETFs saw $6.34 billion in net inflows, with July seeing $172 million, August $3.52 billion, and September $2.65 billion. This brought the cumulative 2024 inflows to over $57 billion and the Assets Under Management (AUM) to over $100 billion.

On October 2, a ten-minute spike in BTCUSD triggered about $110 million in short liquidations, which is seen as a short squeeze. No confirmed news catalyst was behind this event, but it led to heavy short liquidations on centralized exchanges, forcing leveraged closures and boosting volatility in the market.

Analysts attribute the price movement above key moving averages to ETF inflows, specifically noting that the 50-day average crossed above the 200-day average. This revised bullish stance is supported by Citi's increased estimate of $5 billion in 12-month BTCUSD spot CFD ETF inflows, citing increased adviser and brokerage Bitcoin exposure.

Large Bitcoin holders have also boosted their allocations, with a 40% increase in 30-day stablecoin inflows to Binance from wallets over $1 million. Corporate buyers added 4,603 BTC (~$369.7 million) in late August, lifting corporate holdings to 847,666 BTC by September 27.

Despite the bullish momentum, there is a risk of reversal due to the lack of strong flows and key resistance levels around $87,000-$87,722. A breakout above this level could target mean-MVRV near $96,700 if ETF inflows accelerate.