The Bitcoin (BTC) rate on November 9 increased by more than 5%, approaching $38 thousand paired with the stablecoin Tether USD (USDT) on the Binance exchange, this is the maximum rate since May 2022, writes RBC Crypto.
A positive trigger for the price increase was the news that the US Securities and Exchange Commission (SEC) began negotiations with Grayscale regarding the launch of its exchange-traded fund (ETF) for Bitcoin, as well as a message from analysts Bloomberg that the regulator has opened an eight-day window for possible approval of ETFs from 12 more companies that previously submitted applications for consideration by the commission.
The cryptocurrency market has recently shown increased volatility amid expectations of approval of applications for the launch of exchange-traded funds (ETFs) focused on Bitcoin, comments BitRiver financial analyst Vladislav Antonov. Investors believe that the entry of ETFs from major players such as BlackRock or Fidelity into the market will lead to further growth in the value of Bitcoin.
The regulator, represented by the US Securities and Exchange Commission (SEC), is taking a cautious position and postponing decisions on applications to launch ETFs, which have already been submitted by 12 management companies. Experts believe that the most likely scenario is the simultaneous approval of several applications for the launch of a Bitcoin ETF in early 2024, the analyst argues.
“Buyers managed to test the resistance zone of $36,200 – $36,500 before November 9. According to cyclical analysis, from November 9 to November 21, they will be vulnerable,” notes Antonov. “Since all key levels have been passed, we now need to maintain current positions until the third ten days of the month in order to reach $42 thousand by the new year.”
In the near future, there will remain high uncertainty in the crypto market associated with the potential launch of ETFs. This will contribute to continued increased risks and volatility, the analyst predicts.
Fear of missing out
The reason for the rapid rise of Bitcoin is the reluctance of investors to miss out on “the wave of growth that could cover the industry” if the instrument is actually approved, says Anton Toroptsev, regional director of the CommEX exchange in Russia and the CIS, who associates investor behavior with the so-called fear of missing profits out, FOMO).
In October, even fake news about a spot Bitcoin ETF fueled the market, Toroptsev recalls. As a result, Bitcoin managed to gain a foothold above the psychological level of $30 thousand and set off to update local highs.
“Many members of the crypto community believe that this tool will attract trillions of dollars of investment into the crypto industry. But previously, market participants pinned similar hopes on futures and cryptocurrency options. Unfortunately, the launch of the tools did not lead to the expected result,” states Toroptsev.
As for the future goals of Bitcoin, everything will depend on the news background, he believes. If the price of Bitcoin is fueled by rumors about the approval of an ETF, in the near future investors could see an “assault” at the $40 thousand level. In the absence of positivity, “the bubble of expectations may burst” and Bitcoin will go into a correction, probably in the region of $30 thousand, the expert warns.
How long will the growth last?
Judging by technical analysis and market structure, as well as taking into account fundamental factors, we can say that Bitcoin is in an important phase of its cycle and is preparing for a sharp upward movement, says Roman Nekrasov, co-founder of the ENCRY Foundation.
“The $36 thousand level is an important support zone, and its repeated retention indicates the formation of new price levels. Important support zones for Bitcoin are $32 thousand and $34 thousand. Now that BTC is approaching $37 thousand, I expect continued growth to the levels of $38 thousand and $40 thousand,” the expert predicts, adding that if Bitcoin price will fall below $36 thousand, this may indicate a continuation of sideways movement or a possible correction.
An increase in open interest, according to Nekrasov, may be a sign of increased trading activity and foreshadow the continuation of Bitcoin’s upward trend. This comes in the context of increasing interest from institutional investors and the expanding use of cryptocurrencies in various areas of the economy, he explains.
Another important factor is that Bitcoin is increasingly attracting the attention of traders for its role as “digital gold”. This plays out well during periods of economic and geopolitical uncertainty, such as the one we find ourselves in now. Many now view Bitcoin as a tool for preserving capital and long-term investment, Nekrasov believes.
Increasing interest from institutional investors, limited supply of Bitcoin, the use of cryptocurrencies in various industries and media news do have an impact on price growth, agrees 0xprocessing co-founder Nikita Vassev, but he is still skeptical about further strong price increases in the near future.
“I am not so optimistic about the rise in the price of Bitcoin and am waiting for a correction. My market scenario, formed three months ago, continues to be worked out, and I expect that the price will tend to $38 thousand and above, and then go down for a long time,” Vassev predicts.
Big players in the market will manipulate the price, and the expected approval of the ETF, as well as “general euphoria about it,” could lead to buying at an inflated price, the expert warns. In his opinion, in the coming year, the Bitcoin exchange rate will move in the price range of $25–36 thousand, and “a real bull market with the growth of Bitcoin and the rise of altcoins by 10–20 times” should be expected only in one and a half to two years.
“At the moment, I recommend collecting promising altcoins and trading them between levels in order to accumulate positions until the target event occurs – that same market takeoff,” notes Vassev. “Local drawdowns are possible, but the potential profit on individual positions can be more than 1000%.”
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