BITCOIN ETF APPROVED | WITHOUT AN ISSUE..

CRYPTO NEWS

Bitcoin Spot ETF: We Have Lift Off!!

Last Wednesday marked a momentous occasion for major investment houses as the official announcement of the approval of a Bitcoin Spot ETF sent shockwaves through the financial world. A tumultuous 24-hour period, filled with uncertainties and even the circulation of 'fake news' the day prior, culminated in the world's most prominent cryptocurrency receiving the coveted green light for its very own Spot ETF.

The introduction of an Exchange Traded Fund (ETF) presents an enticing alternative for investors, enabling them to invest in a share of the asset without the complexities associated with physically acquiring Bitcoin. Existing regulations make this alternative particularly attractive, and while a Futures ETF has been available, the Spot ETF now allows investors to engage with the actual asset directly, providing a means to track the current spot price instead of a futures contract.

Approval for such a fund has been a prolonged endeavour for various companies, including industry giants like Blackrock, Fidelity, and Grayscale, who have tirelessly pursued this opportunity for over a decade. This development is anticipated to catalyze further mainstream adoption of cryptocurrency.

Within hours of the announcement, television adverts promoting this new investment avenue began airing across the United States. Gary Gensler, the chairman of the Securities and Exchange Commission (S.E.C), known for his critical stance on the crypto-space, had to relent following a significant court case last year. The court ruled in favor of investment companies, criticizing the S.E.C for rejecting Greyscale's proposal, prompting Gensler to ease his grip on approving such funds.

Immediately following the ETF news, Bitcoin surged to a 23-month high of $48,969. However, the true beneficiaries were altcoins, experiencing gains of up to 20% in the aftermath, driven by the optimism that more Spot ETFs may soon receive regulatory approval.

Bitcoin Rise & Plunge Follows Rollercoaster Spot ETF Start

In a much-anticipated move, the cryptocurrency space witnessed a historic event as Bitcoin commenced its trading journey following the Securities and Exchange Commission (S.E.C) approval of a Bitcoin Spot ETF. The initial moments were marked by a surge in price, propelling Bitcoin to nearly $49,000 on Binance Exchange, reaching levels not seen in two years. However, this exuberance was short-lived, as the digital currency experienced a decline, touching a low of $41,500. At the time of writing, recovery remains elusive.

The trend extended to major altcoins, mirroring Bitcoin's trajectory. The Spot ETF launch catalyzed gains of up to 10%, but these gains evaporated throughout the day, portraying a seemingly sell-the-news event. Trading volume for the newly introduced Spot ETFs reached approximately $6.4 billion, but a significant portion was attributed to selling pressure.

Bitcoin Futures trading witnessed substantial volatility, with traders facing large liquidations totalling around $230 million. This phenomenon transcended beyond Bitcoin, affecting various cryptocurrencies and extending its impact to crypto-related traditional finance companies. Coinbase shares plummeted by 7.4%, while Bitcoin mining companies, exemplified by Marathon Digital, experienced a staggering 15% loss in trading.

The market's medium-term trajectory remains uncertain, with investors cautiously observing whether this pullback presents a buy-the-dip opportunity within the broader bull market that was initiated in November 2022, following Bitcoin's bear market lows of $15,476. The aftermath of this significant development will undoubtedly shape the narrative of cryptocurrency markets in the coming weeks and months.

Ripple: No Public Plans In Share Buy-Back Programme Announcement

Brad Garlinghouse, the CEO and leader of Ripple Labs, a prominent player in the global payment remittance sector, recently revealed the company's decision to remain a private company amidst regulatory challenges. In a strategic move, Ripple intends to uphold its commitment to buy back $285 million worth of private shares from existing investors, fostering liquidity within the company. Rather than opting for an initial public offering (IPO), this decision is seen as a response to the regulatory hurdles the company is currently navigating.

Ripple aims to diminish the available share count by offering investors cash in exchange for their shares. Consequently, this move is anticipated to elevate the value of each retained share, thereby enhancing the overall company valuation. Ripple has imposed a limit of 6% on the amount of stake investors can sell back to ensure a measured buyback process and avoid potential market disruptions. This precautionary measure prevents a large-scale sell-off that could trigger a market 'run,' safeguarding against a substantial devaluation of the company.

Presently holding $25 billion in cryptocurrency, predominantly in their native token XRP, Ripple's buyback initiative is poised to potentially elevate the company's value to around $11 billion. Additionally, the company has earmarked an extra $500 million for the conversion of restricted stock units (RSUs) into shares, a common component of employee compensation packages. This announcement coincides with the Securities and Exchange Commission (SEC) requesting Ripple to furnish its financial statements and details of Institutional Sales activities in the ongoing legal tussle between Ripple and the regulatory body. As of the latest update, XRP is trading at $0.53.

TECHNICAL ANALYSIS

Bitcoin (BTC)

This week's analysis commences with our customary exploration of Bitcoin, and it has been nothing short of spectacular. The week unfolded with remarkable events, driven by the anticipated fundamental news. Monday saw a highly positive start, reaching a 2-year high, accompanied by notable volatility on both the long and short sides of the market – a reaction expected given the broader cryptocurrency market's anticipation. Following the breaking news on Thursday, prices soared to new highs, hitting $48,969 before experiencing a sharp crash, concluding at the lower end of its range. Since breaching the previous day's low, the trend has been downward, and as of the current writing, we find ourselves consolidating at the lows.

Notably, the price has not only re-entered the previous upward trend channel, as depicted below but is now breaking lower trendline at the time of writing. For a couple of days, price was hovering on the lower trendline attempting to find short-term support before deciding on its next move – either gaining strength or retreating further into a more significant pullback. From a technical standpoint, warning signs were evident; the earlier highlighted daily bearish divergence, persisting for several weeks, indicated a topping formation with three higher highs and a downward-sloping RSI indicator.

On a positive note, the chart reveals a hidden bull in the RSI, characterized by an upward-sloping price and a downward-trending RSI. This mid-ranging indicator suggests that the price is poised for movement in either direction. Turning to the monthly chart, we've reached the crucial 0.618 Fibonacci retracement from the all-time high of $69,000 to the major monthly November swing low at $15,476, reacting dramatically to the news and the first time this has been hit since the monthly swing low. It's intriguing how technicals align with fundamentals and vice versa – an area we've been monitoring for months with combined resistance, and it's noteworthy that it coincided with game-changing news.

If the price continues to drop over the next week, we'll be on the lookout for turning points and price objectives. A notable point of daily support to monitor is the area marked by the green rectangular shaded pattern on the chart, approximately at $41,250. A break below this level would signify a bearish development, potentially leading to a more substantial retracement. As always, our vigilance over Bitcoin will persist on a weekly basis.

Ethereum (ETH)

Turning our attention to Ethereum (ETH) against USDT, I present this chart due to its current resilient performance compared to most altcoins. Beginning with the 4-hour chart, the price has successfully broken through resistance indicated by the horizontal blue line. Observing whether the price can maintain its position above this line is crucial. Typically, once a price breaks to the upside, old resistance should transform into new support, which holds true in this case. Vigilance is necessary to ensure it doesn't fall back below that line, as it could signal a bearish turn and a further retracement.

On the optimistic side, we may witness higher prices if the price sustains above this level and holds as support. Examining the monthly chart reveals that the price is currently encountering a zone of resistance, as marked by the four blue arrows to the left. A decisive move above this level could propel the price up to the 50% level of the entire pattern, originating from the highs of November 2021 at $4,868 down to June 2022 swing low of $881, placing it at $2,874. Although not a Fibonacci retracement point per se, it holds significance as the midpoint between the bullish and bearish sentiments. Further progress beyond this point might signal a potential move towards the 0.618 level at $3,345. Notably, I've indicated two black arrows on the chart, highlighting a confluence of support in that region. I eagerly await future developments on the Ethereum chart to reassess and analyze any emerging trends.

Near Protocol (Near)

In the final chart analysis of the day, we delve into Near Protocol, which is currently at a critical juncture, sending mixed signals. Despite the bearish triangle pattern evident on the daily chart and the encounter with significant resistance on the monthly chart, the market's unpredictable nature reminds us that nothing is guaranteed. Two daily charts are presented below, with the first illustrating the traditionally bearish descending triangle pattern. While long spikes at the lower trendline could suggest a bullish wedge, I've opted for the bearish pattern, aligning it with the horizontal line hitting body opens and closures, a key consideration in my technical analysis.

On the contrary, examining the chart on the right, the price has found support at the Fibonacci retracement level from the December 2022 swing low to high, positioned at $3.04, with a confluence of support at the 50-day EMA. The RSI indicator is mid-ranging, indicating room for movement in either direction. The monthly chart provides intriguing insights, indicating that we are currently at a major resistance point from the August 2022 swing high of $6.11 to the October 2023 major swing low of $0.971, situated at $4.14. Breaking through this area has proven challenging, and it holds added significance due to a substantial confluence of resistance at the August 2022 swing high, marked by the five blue arrows at the (1) level, which is the starting point of the Fibonacci pattern.

If we manage to surpass recent highs, the 0.618 area becomes a substantial point of interest, and we will closely monitor the asset in the short to medium term, keeping a keen eye on all developments, especially if we head towards that all-important fib level.