Bitcoin Experiences Sharp Dump, Prompting Concerns
On Wednesday, bitcoin and the altcoins witnessed a significant dump, potentially triggered by a prediction made by a Matrixport analyst. Is this cause for worry?
Everything seemed to be going smoothly for bitcoin and the crypto market until Wednesday morning. Suddenly, bitcoin’s price took a nosedive, with the price dropping to $40,600 before quickly rebounding.
Possible Rumor Behind the Dump
It’s possible that the dump was triggered by a prediction from a Matrixport analyst who suggested that all bitcoin ETF applications would be rejected in Q1. The analyst believes that the 5-member SEC committee, led by Gary Gensler, who is known to be anti-crypto, would deny the applications.
The analyst’s argument is based on the perception that crypto is associated with bad actors and non-compliance. However, it remains unclear how this relates to the approval of a Spot Bitcoin ETF.
Whether the dump occurred due to natural market behavior or the negative rumor about ETFs, it’s impossible to determine.
It’s Just Temporary Noise
The key takeaway here is that this dump is just temporary noise. Even if the ETFs are not approved this time, it’s only a matter of time before they receive approval.
Bitcoin is widely recognized as a commodity and is viewed separately from the rest of the crypto market, which is associated with certain project-related concerns.
Bitcoin Price Rebound
As a result, the price of bitcoin is now recovering, and this positive momentum is also benefiting the rest of the crypto market.
According to Trading View, bitcoin has already regained more than 6% of the roughly 10% that was lost on Wednesday. In the short term, bitcoin is encountering resistance at the first of two local levels. It has also returned to the bullish ascending triangle pattern, suggesting that it may surpass the resistances and target $48,000.
Source: Trading View
Hot Take: Bitcoin Dump Sparks Concern, But Recovery Appears Promising
Although bitcoin experienced a sudden dump, triggered possibly by a negative rumor, it’s important to remember that this kind of volatility is expected in the crypto market. Despite the concerns, bitcoin is showing signs of recovery, and the approval of bitcoin ETFs is likely inevitable. Therefore, it’s advisable to focus on the long-term potential of bitcoin as a commodity and the positive trajectory of the crypto market as a whole.
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