Bitcoin closed yesterday with prices above $43,000, opening the doors to completely different graphical scenarios from those hypothesized last week and bringing optimism to the market: the analysis of the crypto price indicates the possibility of a recovery of local highs in the short term.
All the details below.
Summary
- Bitcoin still above $43,000 makes crypto investors dream: price analysis
- New proposals for the launch of a spot ETF in Hong Kong support Bitcoin
Bitcoin still above $43,000 makes crypto investors dream: price analysis
While the cryptocurrency market is being scared by mainstream media FUD news related to MT.GOX refunds, Bitcoin surprises everyone once again and returns with its head held high above $43,000 USD, with price analysis suggesting the possibility of a bullish continuation.
The cryptocurrency par excellence, after yesterday’s pump, has brought its market capitalization back to $850 billion, with dominance slightly increasing to 52.6 percentage points compared to other currencies in the sector.
The optimism and confidence of market operators are starting to be felt after Bitcoin had lost over 20% of its price following the approval of the spot ETF in the United States, which has launched regulated investment vehicles offered by the most well-known Fund Managers in the country.
From the minimum of 38,600 USD reached on Tuesday, January 23rd, Bitcoin has recovered about 13% of its value lost during the last price correction, which involved not only the orange coin but more generally all the cryptocurrencies in the market.
Yesterday’s pump was decisive in surpassing a very important liquidity zone for price action, which has allowed for a potential continuation of the trend by the bulls. In particular, at the $43,000 level, there were many liquidations in perpetual markets, now reallocated in a much less aggressive manner at $44,000.
Now traders’ spirits are more inclined towards optimism, improving from the conditions of neutrality and uncertainty that we could observe in the previous days.
The Fear and Greed index, which provides insight into market sentiment based on yesterday’s data (thus 24 hours late), indicates a positive absolute value of 61, typical of moderate optimism.
The responsibility for recovering the price level of $43,000 USD by Bitcoin is subject to the inflow of money from ETFs in the USA.
In particular, expert analysis shows how outflows from Grayscale have significantly decreased, reaching for the first time in 8 consecutive days below the threshold of 10,000 BTC per day.
At the same time, IBIT by BlackRock, FBTC by Fidelity, ARKB by Ark Invest, and BITB by Bitwise, attract more inflows than outflows from Grayscale, making the netflow significantly positive. (Bitcoin Treasuries data)
If this condition were to remain unchanged in the coming days, we could expect a jump above 47,000 USD for BTC, with the analysis showing an increasingly bullish outlook.
Even Coinbase, custodian of many ETF’s BTC, has benefited from this situation with its stock growing by 6% yesterday on Nasdaq.
New proposals for the launch of a spot ETF in Hong Kong support Bitcoin
Another factor that has certainly created the conditions for a rise in Bitcoin to around 43,000 USD concerns the pressure from one of the main asset managers in Hong Kong, who has requested Chinese regulatory authorities to approve the first exchange-traded fund in the Eastern country.
The request, submitted on Friday by Harvest Fund Management, if accepted by the Securities and Futures Commission (SFC), would expand the global recognition of the crypto asset, creating new regulated trading venues and offering Chinese investors a secure method to start investing.
The official launch of the Bitcoin trading tool is expected potentially on February 10th, right after the Hong Kong lunar new year, but it could be delayed by a few weeks/months.
In addition, according to Bloomberg, Venture Smart Financial Holdings Ltd. (VSFG) is also considering a new ETF in China that could likely be available in the first quarter of this year.
In addition, to all this, there are developments in the field of stablecoin, with the same managers who are applying for an ETF that pushes the Hong Kong Monetary Authority (HKMA) to promote new stable cryptographic resources, which should integrate with the emerging CBDC in the East.
On my price analysis front, we see how the situation is now definitely less uncertain compared to the observations of the previous days.
At the time of writing, Bitcoin is trading at a value of 43,350 USD, staying above the EMA 50 daily, recovering after a few days of negative closures.
Now the most likely trading range in which the asset will fluctuate during the week is between 42,000-45,000 USD, waiting for one of the two extremes to be broken and for the price action to take a clear direction.
The funding rate on derivative markets has returned widely positive, as well as the open interest which has jumped above 11 billion dollars, highlighting the speculative interest of crypto market participants.
The volumes on the spot markets unfortunately are not encouraging and leave room for a potential bearish move that could take control of the situation.
Anyway, the odds are in favor of a bullish continuation for Bitcoin, which seems to be heading towards $50,000 USD by the end of Q1 2024.
The orange coin, which is known to surprise the entire crypto community with its unpredictability, is therefore preparing for its fourth halving, and who knows if for the first time in history a new all-time high will be reached before (and not after) the well-known halving of mining rewards.
If this does not happen by April, no worries: Bitcoin would still have time to print other positive performances from here to the next 12-18 months, with a target likely above the long-awaited 100,000 USD per unit.
The bull market is right in front of us.
