Bitcoin (BTC) bears continue to dominate the price action as the top crypto sank lower in early trading on Tuesday, briefly touching support at $38,500 during the morning session as market watchers continue to monitor the flows for the recently listed spot BTC ETFs.
Data provided by TradingView shows that $38,500 was a solid level of resistance during Bitcoin’s runup in November and December, and bears are now looking to flip it back to resistance and drive BTC price lower.
BTC/USD Chart by TradingView
But bulls are not giving up without a fight, and have managed to push Bitcoin back above $39,300 at the time of writing as they attempt to avoid a pullback to lower support at $37,000.
“February Bitcoin futures prices hit a seven-week low in early U.S. trading Tuesday,” said Kitco senior technical analyst Jim Wyckoff, who noted that “bears now have a slight technical advantage and are working on a fledgling price downtrend on the daily bar chart.”
But the weakness could only be temporary, according to the co-founders of on-chain analytics firm Glassnode, who think Bitcoin could be poised for a parabolic rise if a previous pattern repeats itself.
“Bitcoin has moved to the 6.618 Fib Extension after a Bull Flag Correction,” they said. “We are currently in a small correction like in late 2017 and late 2020.”
BTC/USD 1-week chart. Source: X
“Will History rhyme in 2024 - and BTC move to its 6.618 Fib Extension in this Bull Market? That would give us a target of ~120K,” they said. “Time will tell.”
According to market maker and analyst CJK, Bitcoin selling related to the spot ETFs is the main source of weakness for the top crypto, and once that is done, the uptrend will resume.
“GBTC conversion to Bitcoin ETF investors have sold > $2 Billion. FTX bankruptcy liquidation has led to > $1 Billion in selling BTC. GBTC discount to NAV arbitrage trade led to > $1 Billion selling to lock in profits,” he said. “All of that selling in a relatively short time and BTC is still holding above $40k. Anyone who thinks Bitcoin is struggling right now has no idea how price discovery works.”
“Bitcoin is the most liquid and secure 24/7 asset in the world,” he added. “As soon as the FTX liquidation, GBTC arb profit taking, and ETF speculative distribution are done… Bitcoin will head back to top of range with authority. TradFi will watch in disbelief as we break out to new ATHs in Q4. Then we get to distribute to all the FOMO ETF demand and reaccumulate after a cooldown to post-halving cost of production.”
“Bitcoin's fixed monetary policy allows for proper planning,” he concluded. “The 2024 halving can change your life. Study the cycles, stack sats!!”
