Global Crypto Market Update – 16th January 2024

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Here are the biggest news and updates from the Crypto world over the past week!

On Wednesday, the US Securities and Exchange Commission (SEC) approved the first US-listed exchange traded funds (ETFs) to track Bitcoin (BTC), in a game changing decision for the crypto industry. A total of 11 applications were approved by the SEC, including from BlackRock (BLK.N), Ark Investments/21Shares (ABTC.S), Fidelity, Invesco (IVZ.N), and VanEck.

 

Following the SEC’s landmark approval, the US-listed BTC ETFs saw substantial trading activity, with $4.6 billion worth of shares being exchanged by Thursday afternoon, according to LSEG data. The ETF launches led to a huge surge in Bitcoin prices, with BTC reaching its highest level since December 2021, whilst analysts projecting inflows into spot Bitcoin ETFs to surpass $10 billion in 2024.

 

On the subject of the BTC ETF decision, SEC Chair Gary Gensler has warned that his agency remains broadly unsupportive of the world’s most popular cryptocurrency, despite having given the green light to several spot BTC ETFs. Gensler reiterated his agency’s stance towards Bitcoin, contrasting its “speculative” nature with the utility of precious metals like gold, silver, and platinum.

 

On Thursday, BlackRock, a prominent investment firm, unveiled its inaugural video advertisement for the recently introduced iShares Bitcoin Trust ETF (IBIT). The ad showcases a BlackRock executive discussing the value proposition of Bitcoin and explaining how investors can gain exposure to the newly launched ETF.

 

Ripple CEO Brad Garlinghouse is scheduled to attend the prestigious World Economic Forum (WEF) in Davos, taking place between 15-16 January 2024. This year represents a notable change in Ripple's participation at the WEF, moving from peripheral events to actively participating in the forum's core discussion.

Technical Overview (BTC)

Following the launch of several ETFs, Bitcoin's market experienced a notable shift. The ETFs initially triggered a surge in Bitcoin’s price, pushing it past $49,000.

However, the rally was short-lived and soon faced considerable resistance, leading to a significant shift in momentum, with a pullback resulting in three consecutive days of losses.

This pattern mirrors previous post-event declines in Bitcoin’s history, such as the 2017 futures launch and the introduction of the futures ETF in 2021.

 

Despite the recent 8.8% decline over the last week, Bitcoin's daily chart maintains its uptrend structure.

However, the market has signaled a bearish divergence in price patterns and technical indicators, suggesting potential exhaustion of bullish momentum following the ETF decision. Momentum currently remains bearish, particularly while price remains below $44,000.

A move above the $44,000 threshold could indicate a short-term bottom, shifting momentum to bullish, with the next resistance level outlined at $46,000.

 

The $40,000 mark serves as a crucial support level for Bitcoin, acting as a significant psychological barrier.

A breach below this level could trigger an additional corrective phase, possibly directing the price towards long-term support at the 200-day moving average, aligning with the previous consolidation region just above $35,000.

 

The considerable net inflows into new US spot funds demonstrate ongoing interest in Bitcoin, despite prevailing market volatility.

How the cryptocurrency behaves around the key levels will be crucial in determining its short to medium-term trajectory.

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