Bitcoin is losing upward momentum as sizable outflows from spot ETFs coincide with a rejection at a key technical level.

After serving as a major driver of the recent rally, U.S.-listed spot bitcoin exchange-traded funds are now seeing capital exit the market. On Wednesday, investors pulled $635 million from the 11 funds—the largest single-day outflow since Jan. 29, according to SoSoValue.

The withdrawals are part of a broader trend. Over the past five trading days, cumulative outflows have reached $1.26 billion, trimming total net inflows since the ETFs launched in January 2024 to $58.5 billion from $59.76 billion just a week earlier.

At the same time, bitcoin’s rally has stalled near the 200-day simple moving average around $82,000. After climbing from $65,000 to above $80,000, prices have struggled to extend gains, with BTC slipping more than 2% in the past 24 hours to roughly $79,400.

The pullback comes as inflation concerns in the U.S. resurface, creating headwinds for risk assets like crypto. Notably, the weakness in bitcoin contrasts with continued strength in equities, as both the Nasdaq and S&P 500 pushed to fresh record highs.

The scale of ETF outflows is particularly notable given that strong inflows in March and April were widely credited with supporting bitcoin’s advance. Now, with the macro backdrop turning less favorable, that tailwind appears to be fading.

Market participants warn that external conditions could outweigh flow dynamics. A persistently elevated CPI, a more hawkish Federal Reserve stance, or renewed energy price shocks could pressure bitcoin even if fund flows stabilize.

At the same time, the relationship between ETF activity and bitcoin’s price is weakening. The 90-day rolling correlation between BTC’s daily returns and changes in cumulative ETF inflows has dropped to 0.16, down sharply from 0.68 in February—suggesting little statistical linkage.

In practical terms, daily ETF flow direction no longer offers a reliable signal for short-term price movements. Still, large-scale redemptions like Wednesday’s remain important, particularly when they align with fading technical momentum and a more challenging macro environment.