The Bitcoin Price Continues to Decline
The price of Bitcoin saw another drop yesterday, falling more than 5% to a low of $40,660. This brings the total decline from its January high of $49,000 to 17%. However, crypto analyst Jacob Canfield believes that the correction may not be over yet. In a recent analysis, Canfield warned that there could be more downside in the short-term.
The Uncertainty in the Market
Canfield acknowledges the growing concern and uncertainty in the market. Many are wondering where the price of Bitcoin will go from here.
Bitcoin ETF Approval and Potential Selling Pressure
One factor affecting the market is the speculation surrounding a Bitcoin ETF approval. This has led to rumors that Grayscale Bitcoin Trust (GBTC) investors are selling their holdings to avoid associated fees. Additionally, court filings reveal that the FTX bankruptcy estate holds a significant number of GBTC shares that are poised for liquidation.
Market Optimism and BlackRock’s ETF
In contrast, there are signs of optimism in the market. BlackRock’s ETF, IBIT, has reportedly been aggressively accumulating spot Bitcoin, adding up to 25,067 bitcoins in less than a week. Canfield suggests that this buying momentum from BlackRock could offset the selling pressure from GBTC, especially considering the upcoming Bitcoin halving.
Potential Price Drops
An analysis of the charts paints a grim picture for Bitcoin’s price in the short to mid-term. The 4-hour trend has been lost and is now acting as resistance, which historically indicates downward price movements. Canfield suggests that if there is a short-term bounce, it could occur at around the $40,000 level. The daily chart also shows significant levels at $48.7k and $38.7k, with the latter potentially being tested again.
Caution in a Low Volume Market
Canfield emphasizes caution in the current low volume and low volatility market. He warns that big moves typically follow these conditions, so vigilance is needed. At the time of writing, Bitcoin is trading at $41,178.
Hot Take: Bitcoin Price Continues to Decline Amidst Uncertainty
The price of Bitcoin experienced another drop yesterday, falling by more than 5% to a low of $40,660. This brings the total decline from its January high to 17%. Analyst Jacob Canfield warns that the correction may not be over yet and suggests that there could be more downside in the short-term. The market is uncertain, with speculation about a Bitcoin ETF approval and potential selling pressure from GBTC investors. However, there are signs of optimism with BlackRock’s ETF accumulating spot Bitcoin. The charts indicate potential further price drops, but caution is needed in this low volume and low volatility market.
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