Bitcoin Eyes Recovery Amid Market Volatility and Rising Altcoin Interest
Summary:
After a significant dip following the approval of spot BTC ETFs in the US, Bitcoin (BTC) showed signs of recovery by rising above $43,000 on Jan 15. The recovery came after unsuccessful attempts to push BTC over $50,000. The market's volatility and GBTC sales, among other factors, create a bearish short-term outlook that's leading some traders to short. However, analysts suggest a squeeze might see the uptrend continue. Furthermore, Bitcoin's dominance against other cryptocurrencies is decreasing, and traders seem to be shifting towards altcoins, especially with an Ethereum ETF now under consideration.
Jan 15 saw Bitcoin (BTC) ascend past $43,000, signaling a potential recovery from the sharp decline that ensued following the approval of spot BTC ETFs in the US on Jan 10. Currently, the BTC price oscillates around the $43,100 mark, up 0.89% on the day. This revival can be traced back to a failed surge past $50,000 last week, stalling at $49,000, which indicated a difficulty in maintaining higher figures. Cointelegraph Markets Pro and TradingView data reflected a brief leap over $43,000 before the ever-changing market caused a 1.05% decline in just two hours. Skew, a respected trader, shared details on X (formerly Twitter), stating Bitcoin's spot markets largely remained stagnant around $43,000 due to "increasing ask liquidity".
Skew also observed that the recent recovery had been propelled by GBTC sales, suggesting some traders had capitalized on the dip. Considering this, head of markets at Cointelegraph, Ray Salmond, confirmed traders have been influenced by ETF selling and have opened up short positions since its approval. However, significant volatility in the Bitcoin options market and GBTC sales on Coinbase could lead to bearish sentiment. But as Skew emphasizes, shorts may get squeezed, and the upward trend might persist.
As per the analyst Mac's comments, with BTC/USD oscillations seen between $41,500 and $43,000, it's plausible Bitcoin could experience another drop to $38,000. This speculation comes amidst news that Bitcoin's strength, as presented by Michaël van de Poppe, CEO of trading firm MNTrading, is waning against other cryptocurrencies in the combined market cap.
Data shows Bitcoin's market dominance index fell from 54.56% to 49.82% within a week. Ethereum (ETH) gains are central to Bitcoin dominance's decrease, accounting for 8.5% and other altcoins showed comparable progress. Traders seemingly reallocated investments from Bitcoin towards the altcoin market after the ETF approval, attracted by seemingly promising risk-return trade-offs, especially with Ethereum ETF now under consideration. Should this trend persist, altcoins, spearheaded by Ethereum, could rally, potentially ushering in the much-anticipated altcoin season.
Published At
1/17/2024 12:29:40 AM
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