Bitcoin Sell-Off DeepensFollowing a bumper start to the year, the Bitcoin market has suffered a period of stagnation over recent months with the March highs around the $74,3k mark holding as the high-watermark for now. Shifting Fed expectations and a changeable US rates outlook has seen the market range-bound between those highs and support around $60,7k.  Following a strong rally off that support level which took price back up to just short of testing the highs, Bitcoin futures have come under fresh selling pressure with the market shedding around 19%. Indeed, Monday saw BTC recording its worst day of 2024 so far.In light of the current push lower, the big question now is if Bitcoin is on the verge of a much deeper reversal lower? Bitcoin ETF OutflowsThe big driver behind the current downside in BTC is the current run of ETF outflows linked to hawkish Fed expectations. The SEC approval of spot-Bitcoin ETFs earlier in the year has changed the way BTC traders to a large degree. A flood of institutional flow means that BTC now trades a lot more like traditional risk assets whereby hawkish Fed expectations and a stronger USD depress the price of the asset. Conversely, a dovish shift in Fed expectations should help bolster BTC. Shifting Fed ExpectationsAs of the last FOMC, the Fed now projects just one rate cut this year, down from three prior, In line with upwardly revised inflation and dot-plot forecasts. As such, expectations of a near-term USD slide have been scaled back, with traders pulling their money out of BTC ETFs to park elsewhere. While this narrative holds, BTC looks poised to remain weak near-term. Indeed, if we see any fresh uptick in US inflation in coming months this could well see the Fed holding off on easing until next year. In this scenario, USD is likely to trade firmly higher, causing greater outflow from BTC funds pulling Bitcoin prices lower. Bullish Factors RemainLooking further out, however, there are still strong bullish opportunities in Bitcoin. The Fed still expects to press ahead with easing and Powell has cautioned that the current outlook on inflation and rates is conservative. Powell explained that further rate cuts could still be appropriate this year depending on how inflation develops. Essentially, should inflation start to cool at a quicker pace, Fed easing expectations will come back into sharper focus, leading USD lower and driving BTC ETF inflows once again. US Data On WatchGiven the order-book clear-out we’ve seen in recent weeks, the market is well positioned for fresh upside should we get a shift in the Fed outlook in response to incoming inflation and inflation linked data. With this in mind, the first focus point will be Friday’s US Core PCE data. Should we see any fresh downside in this reading, September easing expectations will rally, driving USD lower near-term. On the other hand, if data surprises to the upside, this should pressure BTC further near-term. Technical Outlook Bitcoin FuturesFrom a technical perspective, the failure at the 72,550 level suggests a possible double top in play with a higher high (YTD high) and lower high at 72,550. Price is now pushing lower again within the corrective bear channel from YTD highs. The key support near-term will be the 60,695 level which has marked the low since March. A break here opens the way for a test of deeper support. However, if price can hold within the bear channel, a fresh range-rotation higher can still be seen, restoring the bullish outlook.   More By This Author:US Market Commentary – Thursday, June 27Aussie Dollar Commentary – Wednesday, June 26Euro Dollar Commentary – Wednesday, June 26