Bitcoin Awaits Crucial ETF Decision; Experts Propose a Price Correction is Necessary
Summary:
As Bitcoin (BTC) oscillates around $44,000, experts suggest a price correction might be necessary. Despite a 6% weekly increase, Stockmoney Lizards predict that a correction would strengthen the BTC chart. The leading cryptocurrency is currently forming an ascending triangle, with an expected retest of the upper resistance line of 44k. As the decision on the US's first Bitcoin ETF looms, some speculate Bitcoin may continue to rise until the ruling, with a potential resistance between 45k and 48.5k. A market pullback could send prices to the late-mid $30,000 range.
As the US stock market commenced on December 21, Bitcoin (BTC) fluctuated around the $44,000 mark. Experts suggested that a correction in the price of the digital currency was necessary. Insight from Cointelegraph Markets Pro and TradingView affirmed Bitcoin was trading ahead of its range from the last seven days. Bitcoin witnessed a surge the day before, hitting a high of $44,300 before experiencing a drawback. Despite a weekly increase of over 6%, the leading cryptocurrency has sparked caution among some market players.
Trading group, Stockmoney Lizards, in their recent market commentary on X (formerly Twitter), indicated, "A correction seems essential; however, the BTC chart appears incredibly robust across all timeframes. BTC is crafting an ascending triangle, with another retest of the upper resistance line of approximately 44k expected."
The team, like several others, highlighted the forthcoming decision on the inaugural Bitcoin spot price exchange-traded fund (ETF) in the US, due by January 10. Stockmoney Lizards predicted Bitcoin's upward trend might continue until an ETF verdict is declared, proposing a short-term increase target of $48,000. The announcement, even if favourable, could trigger a "buy the rumor, sell the news" situation, the team cautioned.
Along similar lines, QCP Capital opined in their market commentary on December 21, stating, "Actual demand for the BTC Spot ETF at the beginning might not meet the market expectations. This situation sets up a typical 'sell the news' event in the second week of January, creating a possible price resistance for BTC between 45k and 48.5k, with a potential pullback to 36k levels, post which the rising trend could continue."
A correction or adjustment might benefit the Bitcoin market, opined many, with the late $30,000 to mid $30,000 zone being a likely destination for a potential market pullback.
Concluding their update, Stockmoney Lizards stated, "The graphic seems extremely active currently, and an adjustment will be beneficial. A drop beneath the $40k mark could potentially result in the liquidation of several leveraged long positions, leading to a pullback towards the $38k level. Factors supporting this situation include the rally that demands a correction, end-of-year sales and shallow trading activity due to the holiday season."
This commentary shares statistics indicating that short liquidations of Bitcoin are progressively accumulating. Despite being dubbed "less likely", data from the market indicated traders were unprepared for the latest push over the $44,000 mark. CoinGlass statistics highlighted that on December 20, crypto short positions amounting to over $100 million were liquidated - the highest in two weeks. The total liquidation of BTC short positions was $38.5 million.
Disclaimer: This article does not provide investment advice or recommendations. Each investment or trading action involves risk, and readers are advised to do their own research before making a decision.
Published At
12/21/2023 3:38:49 PM
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