Bitcoin He manages to raise his head and recover the US$40,000 after putting US$38,000 at risk. For its part, Ethereum exceeds $2,200.
The top ten market cryptocurrencies They operate with increases but Avalanche (AVAX) stands out with more than 11%, followed by Solana (SOL) with 7.6%.
The market’s doubts with ETFs
The performance of bitcoin after the approval of exchange traded funds (ETF, for its acronym in English) worries the market. The latest falls have raised bitcoin’s declines in the last two weeks to around 20% and this movement has caused the king crypto asset to lose important support.
César Nuez, technical analyst at Bolsamanía, explained that the sharp declines observed complicate the technical aspect of bitcoin, whose correction could extend to $35,000, the level where the 200-session average is located. “In the medium term its trend is bullish and for the moment this is just a stop along the way. The first resistance level is at US$44,000. Only by exceeding this price level could we see a return to the bullish path,” says Nuez.
A good part of the sales observed are due, according to some experts, to the fact that investors are “selling the news” of the approval of ETFs after the strong increases experienced in recent months. In this sense, analysts such as those of JP Morgan They warned that the bitcoin was clearly overbought and that the probability of a scenario like this occurring was very high. For their part, the strategists of the Bitfinex crypto exchange point out that this has been added to the departure of holders who acquired BTC less than a month ago, who have sold their participation at a loss to avoid additional falls.
“Such a substantial decline in average earnings for short-term holders, who tend to react more sharply to short-term market fluctuations, may be a precursor to selling pressure or outflow liquidity,” they explain.
The Grayscale Bitcoin Trust (GBTC) Factor
On the other hand, most strategists point out that much of the sales pressure comes from the outputs of Grayscale Bitcoin Trust (GBTC), which, while offset by inflows into other spot ETFs, have worried the market. The share discount and high management fees have pushed investors to rotate their capital towards cheaper investment products and JP Morgan has warned that, taking into account 2023 flows, this fund could still continue to put pressure on bitcoin.
However, some strategists are somewhat more optimistic about the future of bitcoin. Manuel Villegas, digital asset analyst at Swiss bank Julius Baer, points out that, although the current price consolidation process, Bitcoin fundamentals remain “solid.” This is due to “the fork accumulation “In the long term, increasing on-chain activity and the upcoming block reward halving, along with growing conviction that the US’s fastest and most pronounced monetary tightening cycle is over.”
Similarly, other experts point out that, if the Grayscale data is excluded, the situation is clearly positive for exchange-traded funds; In turn, other strategists point out that the recent rally in equities, especially technological values, could have had its effect on the price of cryptocurrencies. Likewise, an adjustment in market expectations regarding the Federal Reserve’s (Fed) stance could also help digital assets in the not-too-distant future.
Source: Ambito
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