The market is debating whether the recent uptrend is just a short-term rotation or the start of a broader move.
Judging from what top banks are saying, it looks more like the latter. Notably, both JP Morgan and Morgan Stanley view this as a potential “dip,” indicating that the recent fallout on US equities is likely the final phase of the correction, with the macro FUD beginning to fade.
From a technical perspective, the S&P 500’s 1.5% intraday move shows that investors are starting to follow that playbook. With Bitcoin [BTC] Now that we are already seeing relatively stronger inflows compared to equities, it is no surprise that this risk flow is now also flowing into crypto, bringing the “bottom call” back into the spotlight.
Strikingly, the setup looks even stronger when we zoom out to broader capital flows.
Historically, markets that move back and forth between risk-on and risk-off regimes tend to create a textbook rotation into metals. But compared to Bitcoin’s 9.22% gain so far in the second quarter versus gold’s 2.3%, BTC is clearly outperforming, with roughly 4x stronger returns than XAU on a relative basis.
Against this background, the “buy the dip“The story is starting to look more in line with actual price action, reinforcing the idea that this could be more than just a short-term bounce and may be part of a broader bottom structure for risky assets. The key question now is: do on-chain metrics actually confirm this setup, or is Bitcoin at risk of turning this upward move into a bull trap?
Bitcoin derivatives are turning bearish as funding rates hit multi-month lows
The current market setup shows clear bearish positioning in derivatives.
According to CryptoQuant, Bitcoin funding rates have turned negative to -0.016 at the time of writing, putting them in the lowest negative zone in more than two months. This level is comparable to early February and even lower than during the Middle East crisis in March. Aggressive short positioning alongside the recent uptrend is starting to look like a potential trigger for a short squeeze.
But the question is whether this positioning is actually tactical and not so much emotional. The Coinbase Premium Index has risen to multi-month highs, which usually indicates strong demand in the US spot market and fits in with the ‘buy the dip’ narrative. That said, Bitcoin ETF flows are not yet fully confirming the same strength.
As the chart shows, $291 million has flowed out of Bitcoin ETFs, marking the largest single-day outflow in more than a month. In short, there is still a clear disconnect between spot market demand and broader institutional positioning, making BTC’s near-term upside a lot more fragile and volatility-driven.
In this context, the negative funding rates in Bitcoin derivatives do not look purely emotional.
According to AMBCrypto, BTC’s current setup suggests that the return to the $75k resistance is supported by strong capital inflows and spot demand in the US. However, the weaker institutional bid still adds uncertainty to the mix.
Unless that turns around, Bitcoin’s current structure is starting to lean more towards a bull trap scenario, making short positioning seem more strategic in the near term.
Final summary
- Macro settings are improving, with banks calling ‘buy the dip’, S&P strength and rising Coinbase Premium pointing to a possible bottom.
- Bitcoin derivatives and flows are still diverging, leaving BTC’s price heading towards $75,000 potentially vulnerable and at risk of a bull trap.