Analyst Cautions Against Fake Bitcoin Breakout Amid Potential ETF Approval
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Bitcoin’s price has taken a nosedive, plummeting below the $26,000 mark. The notorious cryptocurrency, known for its wild price swings, is currently grappling with considerable volatility, which has put a damper on its promising early-year bull run. Regrettably, it has fallen short of reclaiming even 50% of its previous year’s all-time high. With a substantial influx of supply occurring at the $30,000 threshold, Bitcoin’s value is now in a consolidation phase, hovering around the $25,000 range.
Potential ETF Approval Looms Amidst Warnings
The market’s optimism surrounding potential Exchange-Traded Fund (ETF) approvals for Bitcoin is juxtaposed by a stark warning from DonAtl. This industry expert cautions that Bitcoin bulls could be walking into a trap if a spot-based Bitcoin ETF gains regulatory approval. In a recent strategic analysis, DonAtl astutely notes that sellers might seize upon the ETF approval as an opportune moment to unload their Bitcoin holdings. This move could bring more turmoil than prosperity in a short span of time.
ETF Trap Reality: Bitcoin’s Path to $19,000?
DonAtl’s concern revolves around the idea that even in the absence of an ETF denial, the market’s trajectory could reverse. This scenario presents two plausible outcomes: either an unprecedented price markdown or a wave of adverse news. While the exact outcome remains uncertain, the underlying market vulnerabilities raise genuine worries.
In a scenario where the ETF secures approval, it’s projected that the price might only manage to ascend to a range of $32,000 to $35,000, owing to the current market frailty. Conversely, if the ETF is rejected, the price could plummet to the range of $20,000 to $19,000.
I’m personally still in the it’d be funny stage
That said this time around it all depends on the ETF decisions.
Approval, denial or delay will move the market at least 10% in the short term so sentiment is nearly meaningless
I’ve got very little edge in that situation
— DonAlt (@CryptoDonAlt) August 25, 2023
Glimmers of Hope in Market Recovery
Amidst the prevailing uncertainty, there are glimmers of hope. Recent positive developments include substantial investments from Blackrock and Valkyrie into mining firms, as well as a multitude of Bitcoin and Ethereum ETF applications. The launch of live ETFs in Europe, crypto initiatives in Hong Kong, and a significant Bitcoin investment by Oman contribute to the growing positive sentiment.
Adding to the optimism are the approaching deadlines for Bitcoin ETF applications by industry giants Blackrock and Grayscale’s GBTC, scheduled for September 1st. These deadlines have sparked expectations of a potential market resurgence. Additionally, the possibility of SEC delays in ETF approvals could lead to a period of market stabilization.
Filed under: Bitcoin - @ August 28, 2023 8:23 am