Wednesday saw a large dump for bitcoin and for the altcoins, possibly on the back of a prediction from a Matrixport analyst. Is this anything to worry about?
All seemed to be plain sailing for bitcoin and the crypto market up until Wednesday morning. A sudden dump in bitcoin’s price at around mid morning UK time led to a panicky plummet, with a wick travelling all the way down to $40,600, which was bought back up quickly.
The dump sparked by a rumour?
The dump could have been sparked by an analyst at Matrixport who predicted that all the bitcoin ETF applications would be refused in Q1. His thinking is that the 5-member SEC committee is dominated by democrats, who together with chair Gary Gensler, are extremely anti-crypto.
His reasoning was also around how crypto was considered to be inhabited by bad actors with a failure to seek compliance. However, just what this has to do with the approval of a Spot Bitcoin ETF remains unanswered.
Whether the price dumped because that’s what markets do, or whether the dump might have been inspired by the negative rumour about the ETFs, nobody will ever know.
It’s all just noise
The point to be made here is that it is all just noise. Even if Gensler manages to avoid approving the ETFs this time around, the approval can’t be staved off for much longer.
Bitcoin is widely considered to be a commodity, and is certainly now seen by many institutions in a completely separate light to crypto, and any of the shenanigans that might go on with some projects there.
$BTC price recovers
Therefore the $BTC price is now recovering, and given that a rising tide lifts all boats, the rest of the crypto market is also heading back into green territory.
Source: Trading View
Of the roughly 10% that $BTC lost on Wednesday, more than 6% of this has been recovered so far on Thursday. Looking at the short term price action on the 4-hourly time frame, $BTC is now at the first of two local levels of resistance. It is also back inside the bullish ascending triangle, so perhaps look for the price to work its way through the resistances and break back through the top of the triangle, with a potential target of $48,000.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
