Bitcoin ETF flows accelerate the impact of institutional investors on the market, and reshape the BTC and general structure. Since these investment funds circulated in this area, many see this wave of institutional participation as an unprecedented transformation in bitcoin narration. But what if this institutional data can be used not only to monitor the market, but to excel Bitcoin itself?
Who really buys the investment funds circulating in Bitcoin? Determining “institutional”
The term “institutional” is used repeatedly as an abbreviation of ETF buyer, but in reality, these flows represent a mixture of high -value individuals, family offices and some actual institutional funds. Perhaps only 30-40 % is what we consider real institutions. Regardless, ETF GPA It has grown dramatically to nearly 1.2 million BTC since January 2024. This is a transfer amount, it can be said that it removes a large part of the offer available from the open market indefinitely.
This type of accumulation, especially when associated with the long -term reservation behavior from the treasury companies and even the nation -states, has always changed the liquidity file in Bitcoin. These mineral currencies may never re -enter blood circulation.
Convert ETF flow data into a profitable Bitcoin trading strategy
Many assume that these ETF participants are an example of smart funds, as smart investors move against grains to exploit retail morale. But the data tells a different story. analysis Daily ETF flows (USD) Chart reveals a herd behavior of purchasing heavily in local peaks and benefiting from local bottoms.
Comparison of ETF and Bitcoin financing ratesRetailing morale scale, a strange coincidence shows. Institutions buy and sell in Lockstep mainly, not in front of them. This should not be surprising. Human psychology, cognitive bias and FOMO do not stop affecting people just because they run large sums of money. Even the cabinet sections in large companies often end the purchase to the upholstery.
ETF Bitcoin flow strategy for purchase and celebration: Results
If the ETF buyers simply follow the direction of purchase with the increase in prices and sale with low prices, their flows and external flows can be a possible, or better entry/exit signal, as an indicator of momentum when interpreting them properly. To test this theory, we created a simple strategy using ETF flow data via Bitcoin Pro API magazine.
Logic is clear and direct: buying bitcoin when the inventive investment boxes appear, and sell them when external flows appear. It is not an ideal sign. Early trading displays withdrawals and remarkable weak performance compared to purchase and contract, but when this strategy is applied for a full period since the launch of the circulating investment funds, the returns are impressive. Almost 200 % compared to about 155 % for the purchase and celebration strategy. Even when consistent with the nominal tax rate by 20 % on profitable deals, the strategy still exceeds performance.
Should the Bitcoin ETF flow strategy use?
This type of tactical strategy is not for everyone. Many bitcoiners owners are long -term holders who will never think about selling. But for those wishing to manage risks and capture an edge on the market, this ETF strategy provides a way to benefit from the behavior of the major market participants.
Does the following institutional flows give you an advantage? On its own, perhaps not fixed. Although she is undoubtedly impressive, I have succeeded for a long time, I personally have doubts that this will work on multiple courses. But associated with the wider market context, it becomes a useful tool for measuring direction and enhancing other signals to the revenues of the vehicle.
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Liability: This article is intended for media purposes only and should not be considered financial advice. Always perform your research before making any investment decisions.
The post This Bitcoin ETF Strategy Has Outperformed BTC Buy-and-Hold first appeared on Investorempires.com.
