Bitcoin (BTC) attempted a recovery toward recent highs on Jan. 4 as fresh exchange-traded fund (ETF) news stayed absent.
Analyst hints at slow progress on ETF approval
Data from Cointelegraph Markets Pro and TradingView showed BTC price acting in an area above $43,000.
Commentators had expected volatility on the day as rumors swirled over a potential approval of the first spot Bitcoin ETF in the United States. At the time of writing, however, no announcements had been made.
In his latest posts on X (formerly Twitter), Bloomberg Intelligence analyst James Seyffart stressed that this week should, at best, only see a preliminary nod from regulators, with a formal approval following by Jan. 10.
“Today we’re looking for 19b-4 amendment filings that’ll include changes that SEC and issuers have been discussing for weeks. Namely cash create/redeem. (honestly I expected these by now),” part of his comments stated.
“Still expecting potential approval orders next week.”
Markets likewise refused to price in an imminent decision, with Bitcoin staying broadly rangebound after recovering from a liquidity cascade earlier in the week.
As Cointelegraph reported, versions of how the price could react to the decision vary considerably, with both upside and downside forecasts on the table.
“For now, the topside remains capped by resistance at the 46 - 48.5k region with support at the 40.5 - 42k region,” trading firm QCP Capital wrote in its latest market update sent to Telegram channel subscribers on Jan. 5.
“In spite of the leveraged washout, BTC has climbed back up to 44,000 level. While we remain wary of a ‘sell the news’ knee-jerk reaction to the downside, this resilient price action gives us more confidence in the medium-term bullish view into BTC halving towards Mar/Apr this year.”
Fed “pivot” debate continues in background
Continuing, QCP touched on the main macro narrative pertaining to crypto market performance beyond the ETFs.
Related: March banking crisis rerun risks 40% Bitcoin price crash — Arthur Hayes
This is in the form of interest rate policy by the United States Federal Reserve, and while there is little consensus for a beneficial “pivot” coming this month, March could be a different story.
“Crypto prices continue to decouple from TradFi markets due to the bullish ETF narrative. Rates markets are pricing in 6 cuts for 2024 despite the Fed’s dot plot projections of 3 cuts in 2024,” the update continued.
“Such aggressive pricing in the rates market can be unwound very quickly and turn into a macro risk-off if new data points point to a resurgence in strength in the job market or higher inflation, definitely a key macro risk to watch out for.”
Bitcoin’s next block subsidy halving event is due shortly after the March rates decision.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
