Bitcoin Price Surges on Rumors of SEC Approval for ETF
The Bitcoin price experienced a significant jump this week amid rumors that the Securities and Exchange Commission (SEC) may approve a spot Bitcoin exchange-traded fund (ETF). The speculation suggested that an ETF by iShares could receive the green light, causing the largest cryptocurrency to surge over 10% in early trading.
This sudden increase allowed Bitcoin to break through a crucial resistance level that had been suppressing upward momentum for the past three months. As a result, BTC is now poised to potentially test the psychological $32,000 zone if bulls can maintain control.
Key Points
- The Bitcoin price surged over 10% based on false rumors of SEC approval for a spot Bitcoin ETF by iShares, breaking a 95-day resistance level.
- The bullish breakout sets Bitcoin up for a potential 13.5% upswing to test the $32,000 level if momentum is sustained.
- The Bitcoin Fear & Greed Index indicated neutral sentiment before the breakout.
- Trading volume spiked to $24 billion, a 373% increase, as news of the ETF spread.
- The lack of official SEC confirmation has prevented Bitcoin from sustaining above $30,000 so far, leading to a price reversion after the initial spike.
- If bulls can maintain their position above the broken resistance, further upside is possible. Otherwise, a pullback is likely, extending the ongoing correction.
Prior to the breakout, market sentiment was neutral with the crypto Fear and Greed index sitting at 47%. However, trading volumes soared over 373% to $24 billion as news of the potential ETF approval spread in the crypto community.
With no official confirmation from the SEC, uncertainty remains about whether bulls can sustain their momentum. After reaching as high as $30,127, Bitcoin retraced and formed a long bullish rejection candle on the daily chart.
This suggests that the speculative rally may not hold if buyers fail to keep the price above the now broken resistance turned support. In such a scenario, a pullback is likely, potentially retesting the psychological support level of $25,000.
To maintain the breakout’s upward momentum, bulls need to hold the previous resistance zone and establish it as a new support level. This would allow the uptrend to continue, with the next major target at $32,000 if positive momentum returns.
From a technical perspective, the sharp surge has turned the daily moving averages into support, and the RSI has risen above 60% to indicate growing upside momentum. However, on a monthly view, Bitcoin is still in a downtrend, and previous rallies have faltered after similar surges. Therefore, traders should be cautious of signs of weakness if Bitcoin faces selling pressure around resistance levels.
In conclusion, while the ETF-driven breakout has improved the BTC market structure, bulls face challenges in sustaining a recovery without confirmation from regulators. Unless buyers remain in control, there is a possibility that the relief rally could lose steam.
Hot Take: Uncertainty Surrounds Bitcoin’s Price Surge Amid ETF Rumors
The recent surge in Bitcoin’s price fueled by rumors of SEC approval for a spot Bitcoin ETF has brought both excitement and uncertainty to the cryptocurrency market. While the breakout above a key resistance level presents an opportunity for further upside momentum and potential testing of the $32,000 zone, there are concerns about sustainability without official confirmation from regulators. Traders should closely monitor market sentiment and technical indicators to gauge whether bulls can maintain their position above the broken resistance and avoid a potential pullback. The ETF news has undoubtedly made an impact, but the true staying power of the rally remains to be seen.
Blair Connolly emerges as a luminary adroitly weaving the roles of crypto analyst, dedicated researcher, and editorial virtuoso into a harmonious orchestration of insight. Within the dynamic realm of digital currencies, Blair’s insights resonate like precisely tuned chords, captivating minds from diverse walks of life. His talent for unraveling intricate threads of crypto intricacies blends seamlessly with his editorial finesse, translating intricacy into an engaging symphony of comprehension.
