According to one firm, a number of on-chain measurements and indications continue to imply that the price adjustment may not be complete or, at the very least, that a fresh surge is still unlikely.
Despite the apparent early triumphs of some U.S.-listed spot exchange-traded funds (ETFs), there are still obstacles facing Bitcoin (BTC) that might cause prices to drop in the coming days.
Following the highly anticipated ETF debut last week, bitcoin prices dropped as much as 15%. Grayscale’s Bitcoin Trust product withdrawals are reportedly a factor in the decline.
Bitcoin Faces Volatility
After last week’s much-anticipated ETF listing, the price of bitcoin fell by 15%. One reason for the decline is thought to be the withdrawals from Grayscale’s Bitcoin Trust program.
The market may be vulnerable to negative risks even though ETF volume data from Bitwise, Fidelity, and BlackRock (BLK) exceeded $500 million, suggesting interest from professional traders and regulated funds.
On-chain monitoring company CryptoQuant issued a warning in a note, pointing out that different metrics point to an ongoing downturn or the impending arrival of a new positive trend. The note made clear that large bitcoin holders and short-term traders are still selling heavily, which is indicative of the general “risk-off” attitude. Furthermore, unrealized profit margins have not dropped enough to suggest seller fatigue.
Caution Amid Enthusiasm
CryptoQuant adopted a more cautious approach, in contrast to the sanguine views of numerous traders concerning the approval of bitcoin ETFs. Crypto traders agreed, pointing out that spot sales dampened any rising momentum and resulted in a deliberate sell-off.
Despite the fact that the intraday range of bitcoin was greater than 3.5%, the market’s recent highs on Wednesday precipitated a systematic sell-off.
January 19, 2024 at 09:20 am
Updated January 19, 2024 at 09:20 am