(Kitco News) – Crypto prices trended higher in trading on Thursday as positive developments on the political front have helped ease some of the pressures facing the industry. Bullish projections related to the launch of the first spot Ethereum (ETH) exchange-traded funds (ETFs) in the U.S. also provided a boost to sentiment, with some analysts expecting the products to start trading before July.
“BlackRock has amended its ETH ETF application, with Bloomberg analyst Eric Balchunas noting that the updated S-1 filing is a ‘good sign,’ and suggesting a launch by the end of June is a ‘legit possibility,’” said analysts at Secure Digital Markets. “The iShares Ethereum Trust ether ETF will be listed under the ticker ‘ETHA.’”
The unexpected rapid approval and roll-out of ETH ETFs has had a notable impact on the futures market, as “The put-call ratio for ETH has reached a one-year high of 0.61, suggesting a bullish outlook,” the analysts said. “This bullish sentiment is supported by positive call-put skews across various time frames. Amberdata reports that the seven-day skew is at 2%, while the 30-, 60-, 90-, and 180-day skews are all above 5%.”
After dropping to support at $67,000 overnight, Bitcoin (BTC) reversed course on Thursday afternoon to hit a high of $69,536. King Crypto now finds itself on the cusp of entering price discovery if it can meaningfully hold above the pivotal resistance at its 2021 record high of $69,000, according to crypto analysts.
#Bitcoin Fighting the last resistance before full on price discovery.
It's never an easy fight and usually takes a while, but once supply dried up around this price region, and coins swapped from the impatient to the patient, the result is usually pretty good. pic.twitter.com/dGZJltpsPG— Daan Crypto Trades (@DaanCrypto) May 29, 2024
Bitcoin has struggled below this threshold for approximately 10 weeks, with each breakout attempt soundly rejected by bears.
BTC/USD Chart by TradingView
Analysts at Secure Digital Markets warned that another rejection at this level could result in a slide below $67,000, noting that “A decline below this threshold could indicate a further move towards 65,000, aligning with the 50-day moving average.”
At the time of writing, Bitcoin trades at $68,400, an increase of 1.7% on the 24-hour chart.
“Stocks declined on Thursday as traders anticipated the release of key U.S. inflation data,” said Secure Digital Markets analysts. “Investors are particularly focused on Friday’s personal consumption expenditures price index report for April, the Federal Reserve’s preferred inflation gauge.”
“An increase in the 10-year Treasury yield, which surpassed 4.6% for the first time in a month on Wednesday, has negatively impacted investor sentiment this week,” they added. “Although the yield dipped below 4.6% on Thursday, it remained above the concerning level of 4.5%, posing challenges for risk assets.”
At the closing bell, the S&P, Dow, and Nasdaq all finished in the red, down 0.60%, 0.86%, and 1.08%, respectively. The DXY fell 0.4% to 104.765, and the U.S. 10-year Treasury yield fell 194 basis points from Wednesday’s high and trades at 4.548% at the time of writing.
Fakeout or the start of an uptrend?
Bitcoin’s price has been flirting with the $69,000 level throughout its two-and-a-half-month consolidation, leading market analyst Bloodgood to question if this latest spike is the start of an uptrend or yet another fakeout.
“Remember how we discussed three possible scenarios and which levels to monitor last week? Fakeout, range, breakout,” Bloodgood said in his latest market update. “Well, at the time of writing, it seems that scenario number one is taking place; however, I will not confirm it until I see a weekly close below $69k.”
“Both on the daily and weekly charts, we can see that this pump was sold into immediately after the bulls lost strength,” he said.
“Looking at the daily chart, we can see three consecutive red candles, with the last one touching levels that we have seen prior to the last pump,” Bloodgood said. “The last seven days on the chart look more bearish than bullish, given that after sellers were exhausted, we did not get a higher high, but I am not making decisions based on this.”
For now, Bloodgood said he is waiting for Friday’s Personal Consumption Expenditures (PCE) report and the weekly close for Bitcoin before deciding his next moves.
And for those looking for a good metric to help determine when the crypto market might be topping, CryptoQuant analyst Tarekonchain highlighted the “MVRV (Market Value to Realized Value) indicator,” which “gives a highly accurate alert for Bitcoin price tops and bottoms.”
“Whenever the MVRV value is below 2, it indicates a continued accumulation zone, meaning the price is still below its true value,” Tarekonchain said. “In previous cycles, peaks always occurred when this indicator reached a value of 3.5 or above. At these levels, we start exiting the market gradually as it indicates that a peak has been reached or is very close.”
“Currently, the MVRV value is at 2.3, which means there is still room for the price to rise significantly to reach Bitcoin's fair value,” they said. “Even if the price drops, it's a new opportunity to reinforce. Exiting should only start when the indicator approaches a value of 3.”
“This means we are still somewhat far from the peak, and the price will achieve a new high in this cycle, which could be above $100k,” Tarekonchain concluded.
Mixed performance for altcoins
It was a mixed day for the altcoin market with the top 200 tokens evenly split between winners and losers.
Daily cryptocurrency market performance. Source: Coin360
Notcoin (NOT) was the top performer, spiking 39.1% to trade at $0.13, while JasmyCoin (JASMY) climbed 24.2%, and DOG•GO•TO•THE•MOON (DOG) gained 23.3%. Meme tokens cat in a dogs world (MEW) and dogwifhat (WIF) were the biggest losers, declining 16.8% and 9.1%, respectively, while Chiliz (CHZ) fell 8.1%.
The overall cryptocurrency market cap now stands at $2.55 trillion, and Bitcoin’s dominance rate is 53%.
