Bitcoin ETF announcement hack reveals BTC price upside is likely capped
- Bitcoin price rally was capped below $48,000 following the false SEC ETF announcement.
- Securities lawyers told Fox Business that it would be unprecedented that the SEC kills the ETF applications at the current stage of the process.
- Crypto experts note that Bitcoin holders engaged in “sell the news” or hedging behavior in response to the false ETF approval.
Bitcoin price is likely to see upside capped since BTC price nearly missed the $48,000 level in response to the false announcement of Spot Bitcoin ETF approval. The US financial regulator, the Securities and Exchange Commission (SEC) revealed that the X account was hacked.
Securities' lawyers told Fox Business that an approval is likely since the regulator is unlikely to kill ETF applications after they have reached the current state, post filings and amendments.
Daily Digest Market Movers: Bitcoin Spot ETF’s false approval announcement triggered “sell the news”
- Chris Burniske, co-founder of a venture firm focused on crypto assets notes that Bitcoin traders engaged in “sell the news” or what is considered hedging behavior in response to the false announcement from the SEC of a Spot Bitcoin ETF approval.
- The SEC’s twitter account was hacked and a false announcement was released, despite the approval news, BTC upside was capped below $48,000.
- Burniske tweeted about the development on X.
$ETH got the bid, $BTC got "sell the news" (or perhaps hedging behavior) - let's see what occurs when the ETF announcement happens for real https://t.co/NLMSfJjpMm
— Chris Burniske (@cburniske) January 9, 2024
- Experts at Castillo Trading recommend no new “long positions” in Bitcoin prior to the SEC’s decision on Spot ETF applications in a recent tweet.
To be fair, it really doesnt make sense to be long $BTC here, 2 days before ETF announcement, when you were given 428 days to long prior
— Castillo Trading (@CastilloTrading) January 9, 2024
Not saying a massive correction happens, but this is the type of price action you dont really want to be opening up fresh longs into$BTC pic.twitter.com/qLCOnZbjLN
- Experts believe that the Spot Bitcoin ETF approval could be a non-event for BTC while rest of the crypto ecosystem, altcoins yield gains.
I still think too many people are fixated on $BTC going parabolic or nuking based on ETF news.
— Castillo Trading (@CastilloTrading) January 9, 2024
I personally think $BTC starts to range while the rest of the market plays catch-up.
ETF will be a non event for $BTC other then to trigger the legitimacy of all the shitcoins.
- According to CryptoQuant data, Bitcoin whales are de-risking and avoiding sending their BTC holdings to derivatives exchanges. The risk-off behavior of whales indicates that large wallet investors are waiting on the sidelines for the SEC’s decision on the January 10 deadline.
Bitcoin: Inter-exchange Flow. Source: CryptoQuant
Technical Analysis: Bitcoin price likely to correct to $42,000, gains capped at $49,400
Bitcoin price gains are likely capped at $49,401, the 61.8% Fibonacci Retracement level of the decline from the Nov ‘21 peak of $69,158 to the Nov ‘22 low of $15,541. BTC price is currently above three of its major Exponential Moving Averages (EMAs), the 10, 50 and 200-day at $44,842, $41,819 and $34,478.
BTC/USDT 1-day chart
Further, Bitcoin price has established key support at $42,000 where 2.48 million addresses hold over 1.12 million BTC, according to IntoTheBlock data.
In/ Out of the Money in Bitcoin. Source: IntoTheBlock
If Bitcoin price breaks past the $48,000 resistance, with no major resistances at play directly above, BTC could rally to $53,728.
Cryptocurrency prices FAQs
How do new token launches or listings affect cryptocurrency prices?
Token launches like Arbitrum’s ARB airdrop and Optimism OP influence demand and adoption among market participants. Listings on crypto exchanges deepen the liquidity for an asset and add new participants to an asset’s network. This is typically bullish for a digital asset.
How do hacks affect cryptocurrency prices?
A hack is an event in which an attacker captures a large volume of the asset from a DeFi bridge or hot wallet of an exchange or any other crypto platform via exploits, bugs or other methods. The exploiter then transfers these tokens out of the exchange platforms to ultimately sell or swap the assets for other cryptocurrencies or stablecoins. Such events often involve an en masse panic triggering a sell-off in the affected assets.
How do macroeconomic releases and events affect cryptocurrency prices?
Macroeconomic events like the US Federal Reserve’s decision on interest rates influence risk assets like Bitcoin, mainly through the direct impact they have on the US Dollar. An increase in interest rate typically negatively influences Bitcoin and altcoin prices, and vice versa. If the US Dollar index declines, risk assets and associated leverage for trading gets cheaper, in turn driving crypto prices higher.
How do major crypto upgrades like halvings, hard forks affect cryptocurrency prices?
Halvings are typically considered bullish events as they slash the block reward in half for miners, constricting the supply of the asset. At consistent demand if the supply reduces, the asset’s price climbs. This has been observed in Bitcoin and Litecoin.
Author
Ekta Mourya
FXStreet
Ekta Mourya has extensive experience in fundamental and on-chain analysis, particularly focused on impact of macroeconomics and central bank policies on cryptocurrencies.
