Despite investors' optimistic expectations ahead of the approval of spot Bitcoin-ETFs, the first cryptocurrency's exchange rate fell nearly 15% right after their launch, dropping from $49.000 to $41.400.
On January 10, after the U.S. Securities and Exchange Commission (SEC) approved all applications for exchange-traded funds, Bitcoin reached two-year highs, instantly jumping in price. However, as trading began the next day, its price began to decline.
The sharp rise and subsequent fall in the exchange rate have the hallmarks of a "buy the rumor, sell the fact" reaction that some market analysts expected, Tony Sycamore, a market analyst at IG Australia Pty, wrote in a research note.
Supporters of Bitcoin's contentious role as a store of value argue that the first U.S. spot ETFs on the cryptocurrency mean increased investor access to cryptocurrency. Skeptics point to a deep cryptocurrency crisis in 2022 and ensuing bankruptcies as reasons to be cautious about wider adoption of cryptocurrencies, despite a partial market rebound last year.
Over the past few days, total sales made by so-called short-term investors totaled about 111 000 Bitcoins. At current market prices for this cryptocurrency, the sales are approximately equal to 5 billion dollars.
On Monday, the Crypto Fear and Greed Index, developed by the Alternative.me tracker, showed a change in sentiment in the cryptocurrency market from "Greed" to "Neutral". This came after about three months of a period of "Greed".
Bitcoin's halving could be the closest driver to growth, but until then, investors will be closely monitoring the Fed's signals on U.S. monetary policy.
BTCUSD quotes continue to form an upward trend on the D1 timeframe despite the strong volatility. However, the trend has acquired a corrective component. The Stochastic Oscillator indicator (standard values) points to the curve approaching the oversold zone. Bitcoin price, having rolled back from the trend support, might resume growth within the correction corridor.
Signal:
The short-term outlook for BTCUSD is to buy.
The target is at the level of 50 000.
Part of the profit should be fixed near the level of 45 500.
A Stop-loss should be placed at the level of 39 950.
The bullish trend has a short-term character, so the trade volume should not be more than 2% of your balance.
This content is for informational purposes only and is not intended to be investing advice.
