- January 15, 2024
- Posted by: [email protected]
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In an unexpected turn of events, Bitcoin’s market price has experienced a sharp decline, plummeting to $42,825 with a substantial 7% drop on Saturday, marking its lowest point in 2024. This downward spiral coincides with increasing doubts within Bitcoin’s leadership regarding its widespread acceptance as a mainstream currency.
Simultaneously, the cryptocurrency landscape is witnessing intense competition among spot bitcoin exchange-traded fund (ETF) issuers, particularly revolving around fee structures. Bitwise has notably emerged as a frontrunner in Bitcoin ETF flows on the inaugural day, indicating a shift in the market dynamics.
The recent decline prompts essential inquiries about Bitcoin’s next support level and the potential avenues for its recovery. BlackRock CEO Larry Fink, while acknowledging Bitcoin’s value as an asset class, expressed reservations about its feasibility as a regular transactional currency. Fink views Bitcoin more as an alternative for wealth storage than a substitute for national currencies, emphasizing the probable rise of central bank digital currencies (CBDCs).
Despite Fink’s skepticism, BlackRock’s growing interest in the cryptocurrency sector, including potential ETF investments, could positively impact Bitcoin, fostering wider acceptance among traditional investors and institutions, thereby enhancing the industry’s credibility.
On January 11, a significant milestone was achieved as investment managers, including Bitwise, BlackRock, VanEck, and Ark Investments, launched the first spot Bitcoin ETFs in the United States, following the SEC’s approval of eleven applications.
While many of these ETFs boast competitive pricing, with fees undercutting the average U.S. ETF rate, some issuers are enticing investors by waiving or significantly reducing fees. This strategic move is anticipated to bolster Bitcoin’s institutional legitimacy and engagement, potentially influencing public perception and driving its price upward.
Bitwise Asset Management took the lead on the first day of spot Bitcoin ETF trading, attracting $237.9 million in inflows, the highest among the 11 SEC-approved products. Despite analysts cautioning that initial figures may reflect short-term trading interests, this surge in interest signals a burgeoning market for Bitcoin ETFs, potentially impacting BTC prices positively.
As of Saturday, January 13, Bitcoin’s technical indicators continue to raise caution among traders. The cryptocurrency’s pivot point stands at $44,300, facing immediate resistance at $45,175, $45,950, and significantly at $47,250. On the support side, crucial levels are observed at $42,642, followed by $41,470 and $40,570. The Relative Strength Index (RSI) hovering around 33 suggests the possibility of Bitcoin entering oversold conditions.
Recent trends in the 4-hour chart indicate a breach of the upward channel near $45,000, affirming a bearish inclination. Bitcoin’s price currently lingers below this critical mark, intensifying the bearish outlook. A pivotal level for potential recovery or further decline lies around $42,600.
With the 50-Day Exponential Moving Average (EMA) standing at $45,700, above Bitcoin’s current price, the prevailing bearish sentiment gains weight. Given these technical observations, Bitcoin’s short-term outlook leans towards bearish, with a key focus on whether it can surpass the $42,600 threshold. Investors and traders are advised to closely monitor these levels, as they could signal potential shifts in the trend, either towards recovery or a continued downward trajectory.
