Bitcoin (BTC) threatened a breakdown from its trading range at the Feb. 21 Wall Street open as resistance stayed firmly in place.
ETFs no silver bullet for Bitcoin bull market
Data from Cointelegraph Markets Pro and TradingView showed ongoing retests of the lowest BTC price levels in a week.
After hitting new 26-month highs of $53,000, Bitcoin saw immediate sell-side pressure — even even familiar sources of support, such as anticipation of buyer interest in the spot exchange-traded funds (ETFs), failed to lift the mood.
Responding, popular trader Crypto Chase highlighted Bitcoin getting to grips with the so-called fair value gap (FVG) on daily timeframes, as viewed from Fibonacci retracement levels.
“Looks ugly, but I've seen Bitcoin recover from worse,” part of accompanying commentary on X (formerly Twitter) read.
$BTC
— Crypto Chase (@Crypto_Chase) February 21, 2024
4th test of Daily FVG. Looks ugly, but I've seen Bitcoin recover from worse. I'm flat here.
Plans:
-Daily close above 52.3K = focus longs.
-Daily close through FVG = focus shorts.
-If retrace is offered, buy dip starting at low 47K (46K~ possible too, but I'll frontload). pic.twitter.com/PEeNYSdDL0
Summarizing his latest video update, Keith Alan, co-founder of trading resource Material Indicators, stressed that even ETF inflows could not be relied upon as a foolproof way of buoying the market.
“Midway through the week we are seeing the BTC W candle slip into red territory,” he wrote.
“There is certainly plenty of time for it to recover, and the massive amount of BTC ETF inflows should help mitigate some of the downside, but the fact that we are seeing this pullback despite the ETF demand indicates 2 things: 1. Even in the ETF era of Bitcoin, ‘Up Only’ isn't a thing. 2. BTC Whales are selling into the ETF demand.”
Commenting on the status quo, however, popular trader Daan Crypto Trades called for calm.
“Usually sentiment follows price. If sentiment precedes price without it actually following through, it's often a reason to pay attention,” he wrote in part of a recent X update.
“There's something to say for both directions here but I do feel like the bearish sentiment is getting a bit ahead of itself as we've just been ranging for the last week or so without a clear break. Just wait for confirmation towards either side.”
One of those days where it's good to remember the part of the cycle we're in.
— Jelle (@CryptoJelleNL) February 21, 2024
Lower timeframes look like dog poop, higher timeframes look primed for new all-time highs.
Don't get shaken out.#Bitcoin pic.twitter.com/O2qxAT6alB
Fellow trader Jelle, known for his optimism on the market as it stands, had a similar angle.
Nvidia earnings may spark "frothy week"
Continuing, trading firm QCP Capital attributed BTC price weakness in part to high funding rates.
Related: Open interest echoes $69K BTC price — 5 things to know in Bitcoin this week
“Funding at these levels is typically difficult to sustain which means there could be a pullback in price after such a strong move higher,” it wrote in its latest market update sent to Telegram channel subscribers on the day.
“We have already started to see some selling pressure earlier in Asia afternoon (BTC 50,630 low, ETH 2,880 low).”
QCP noted an upcoming source of potential volatility for risk assets in the form of earnings from tech giant Nvidia, these due after the U.S. close.
“NVDA is currently trading at 90x P/E and Q4 earnings expectations have been adjusted higher recently,” it explained.
“At these valuation multiples and high expectations on earnings, any disappointment could see a sell-off. That would certainly put a drag on US equities and crypto prices as well.”
Daan Crypto Trades likewise assigned significance to the earnings report.
“If they beat bigly and price just goes up hard we can prepare for some volatile & frothy next week or two throughout most markets I think,” part of his own X forecast read.
“Would prefer to see it cool off a bit so the markets don't get overheated too quickly.”
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.
