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Our analysis of the situation
The cryptocurrency market took a 2% tumble in the past 24 hours, with Bitcoin leading the decline, hovering around $2.46 trillion on Friday during the London session. The altcoin sector also witnessed considerable bearish volatility, resulting in over $129 million in forced liquidations.
The launch of the LayerZero (ZRO) airdrop by Binance caught the attention of retail traders, offering an attractive opportunity for BNB holders.
Despite the approval of several spot BTC ETFs in various jurisdictions, including the United States and Hong Kong, Bitcoin (BTC) price has struggled to surpass the $72k mark in recent months. A primary contributing factor has been the intensified selling pressure, particularly emanating from Coinbase Global Inc. (NASDAQ: COIN).
Coinbase has been absorbing the increased Bitcoin selling pressure from spot BTC ETFs over the last few weeks, with United States-based ETFs reporting a total cash outflow of approximately $139 million on Thursday, marking five consecutive days of net cash outflows.
The Grayscale’s GBTC led in net cash outflow with around $53 million, followed closely by Fidelity Investments’ FBTC at $51 million. Bitwise’s BITB also recorded one of its highest daily cash outflows, reaching approximately $32 million. On the contrary, BlackRock’s iShares Bitcoin Trust (NASDAQ: IBIT) experienced a total cash inflow of about $1 million on Thursday.
The continuous closure below the daily 50 Simple Moving Average (SMA) and the declining weekly Relative Strength Index (RSI) signal a midterm bearish sentiment for Bitcoin. Analysts, such as on-chain specialist Axel Adler, suggest that Bitcoin is entering a macro waiting phase due to rising market pessimism and low demand.
From a technical perspective, Bitcoin's price may continue to drop in the coming weeks, targeting a support level around $63,300k. Should this support fail, further decline towards the range between $58k and $60k could be expected.
The approval of spot Ethereum ETFs in the United States and potential introduction of a Solana ETP in Canada indicates a favorable regulatory environment for altcoins, potentially triggering increased adoption and bullish volatility for the altcoin industry.
As Bitcoin dominance approaches a major resistance zone, the altcoin market is poised for heightened bullish volatility. The long-term outlook remains positive, with some analysts setting targets between $120k and $250k for Bitcoin.
In conclusion, while Bitcoin faces challenges in the short term, the evolving regulatory landscape and favorable fundamentals underpin a positive long-term trajectory for the cryptocurrency market.
Disclaimer: Our articles are NOT financial advice, and we are not financial advisors. Your investments are your own responsibility. Please do your own research and seek advice from a licensed financial advisor beforehand if needed.
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Please, behave!