(Kitco News) – Bitcoin (BTC) continued to see choppy, sideways price action in early trading on Tuesday after pulling back from a high of $70,635 recorded on Monday during the slow trading day due to markets being closed for Memorial Day in the U.S.
“Bitcoin is experiencing some pressure this morning as the stock market pulls back at the open,” said analysts at Secure Digital Markets. “Currently, BTC is trading between the resistance level of 71,500 and our support level of 65,000. We anticipate that prices could decline further towards 66,500, presenting a strong entry point for a long position.”
BTC/USD Chart by TradingView
The resilience of King Crypto and its bounce back from the low of $56,550 recorded at the beginning of May come as Friday saw $252 million worth of inflows into U.S.-listed spot BTC exchange-traded funds (ETFs), “contributing to a total of $2 billion in inflows over the last ten trading sessions,” the analysts said.
On Monday, the level of fear spiked as more than a hundred thousand Bitcoins were moved on-chain, causing many to worry that a major price dump was imminent.
“Significant movements were observed as over 140,000 BTC, valued at approximately $9 billion, were transferred from Mt. Gox wallets to an unknown address in thirteen transactions,” Secure Digital Markets said. “This might be part of a plan to repay creditors by October 31, 2024. The market reacted bearishly, with Bitcoin falling to a low of $67,500 after reaching a high of over $70,700 on Monday.”
A statement from the Mt. Gox rehabilitation trustee has helped put investors' minds at ease as he signaled that the transfer was part of the plan to distribute the Bitcoins to creditors.
“Under the Rehabilitation Plan, the Rehabilitation Trustee is preparing to make repayment for the portion of cryptocurrency rehabilitation claims to which cryptocurrency is allocated,” the statement said. “Such repayment means, at the option of rehabilitation creditors, either (i) repayment by way of Designated Cryptocurrency Exchange, etc., receiving bitcoin and bitcoin cash on behalf of the rehabilitation creditors, or (ii) repayment with proceeds from the sale of bitcoin and bitcoin cash.”
Directly addressing the concerns that selling is taking place, the statement said, “At this time, the Rehabilitation Trustee has neither made repayment in (i) above by way of Designated Cryptocurrency Exchange, etc. nor sold bitcoin and bitcoin cash to make repayment in (ii) above. The Rehabilitation Trustee is currently managing bitcoin and bitcoin cash in a secure manner. As the Rehabilitation Trustee is proceeding with the preparation for the above repayments, please wait for a while until the repayments are made.”
Analysts at QCP Capital also sought to calm concerns related to the movement of Mt. Gox Bitcoins, dismissing the fears as “bouts of supply anxiety,” and telling Bitcoin bulls they have little to worry about when it comes to the BTC uptrend.
“Movement of BTC from a Mt. Gox cold wallet this morning triggered a sell off below 68k,” they noted. “However, these bouts of supply anxiety are likely to be blips in a broader trend higher into the end of the year.”
QCP noted “3 bullish reasons” to stay positive about Bitcoin moving forward, including a strong performance from U.S. stocks spilling over into crypto, support from U.S. Presidential candidates, and the recent approval of the first spot Ethereum (ETH) exchange-traded funds (ETFs) on the U.S. market.
And according to market analyst Jelle, Bitcoin is holding up well despite the Mt. Gox-inspired FUD, and things could really get rolling once it successfully breaks above $70,000.
#Bitcoin is holding the bullish flag, despite Mt. Gox transferring a boatload of coins.
Market is rangebound -- but will quickly turn fully bullish if we get above $70,000 again.
Patience until then, but it looks strong.
? pic.twitter.com/P2R7TqV85S— Jelle (@CryptoJelleNL) May 28, 2024
In the equities markets, “Stock futures showed slight movement on Tuesday morning as investors await inflation data expected at the end of this shortened trading week for a clearer market outlook,” Secure Digital Markets said.
“Stocks are on track to end May on a strong note, buoyed by softer inflation data earlier in the month and better-than-expected quarterly earnings reports,” they noted. “Minneapolis Federal Reserve President Neel Kashkari stated on Tuesday that he wants to see ‘many more months’ of data indicating easing inflation before considering rate cuts and did not rule out further rate hikes if price pressures increase again.”
