Bitcoin Hits 21-Month High Amid Speculation Around U.S. ETF Approval
Summary:
Bitcoin hit a 21-month high on January 2 due to anticipation around the potential approval of the United States' first Bitcoin exchange-traded fund (ETF). Despite some sell-offs, the prices remained relatively high, sparking speculation about an impending surge in Bitcoin's value anticipating the ETF approval. The day also saw only $38 million in BTC shorts liquidated, suggesting no significant losses for those betting against Bitcoin.
Bitcoin reached 21-month highs on January 2, sparking a wave of excitement across Asian crypto markets, as indicated in the BTC/USD 1-hour chart by TradingView. This surge in BTC prices occurred as the New Year festivities ended, with enthusiasm mounting around the potential of the United States' first spot Bitcoin exchange-traded fund (ETF).
BTC/USD rallied to an impressive $45,922 last recorded on Bitstamp. Predictions about the Bitcoin ETF are circulating, including potential early action prior to the formal approval window commencing on January 4. It's clear to traders that the anticipation of this ETF positively impacts Bitcoin's price trajectory. According to Crypto Tony, a well-known figure in the crypto-sphere, Bitcoin's current performance suggests the imminent approval of an ETF.
Scott Melker, a fellow trader and podcast host, echoes this sentiment. In contrast, Skew, another trader, observed occasional selling, though volumes remain relatively low. He noted that while Bitcoin's price has plateaued since the beginning of the sell-off, previous highs remain important benchmarks, particularly the $44.4K dip.
Speculation regarding how high Bitcoin can climb surrounding the ETF approval centers on $48,000. Despite Bitcoin's significant 8% gain in 2024, there's been no significant loss from those trading in reverse. CoinGlass' latest data revealed that the day saw only $38 million worth of BTC shorts liquidated at the time the data was compiled.
Previously, the unusually high funding rates across multiple exchanges suggested wide-spread belief in an impending ETF triggering increased Bitcoin value. Liquidity across all cryptocurrencies amounted to $62 million.
According to Skew, early short sellers were caught off-guard when Bitcoin surged past $45,000, leaving perpetual swap traders unprepared for this steep increase. He observed that the dominant players driving this surge appear to be around the $45K mark, leading to a probable volatility feedback loop. This article does not provide financial advice or recommendations. All investments and trades bear potential risk, and individuals should conduct personal research before making a decision.
Published At
1/2/2024 12:36:02 PM
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