Bitcoin is currently trading at around $43,000 and has traded in a range between $40,000 and $48,000 since early December. This comes less than a month after the historic decision by the United States Securities and Exchange Commission to approve Bitcoin exchange-traded funds (ETFs).
In a comprehensive analysis of the recent Bitcoin price, DecenTrader provides insight and predictions on what is happening with BTC and where it is headed.
Based on that analysis, part of the reason why Bitcoin nearly reached $49,000 in early January was the approval of the ETF on January 11th.
According to DecenTrader the sentiment boils down to three reasons that it is the right time to sell. This includes a reach at the technical target from the low "Cup and Handle" pattern, a corrective market pullback of 61.8%.
The price of Bitcoin then continued to decline, mainly driven by outflows from the Grayscale Bitcoin Trust – GBTC. It should be noted that investors in GBTC have no way to unlock their funds prior to ETF approval. So no wonder they continue to sell, causing downward pressure on prices.
Now that the price of Bitcoin seems to have stabilized, it is also important to acknowledge another major driver in 2024 is BTC halving sentiment.
Analyzing its potential impact on prices, DecenTrader says that buying interest will increase as the event approaches. Bitcoin has about 30 days to move through its corrective phase before encountering the expected FOMO demand.
On the other hand, the analyst is of the view that the risk of a large price correction is relatively limited.
In general, most analysts believe this cycle will not be different from previous cycles and that cryptocurrencies historically take 220 to 240 days after halving to record new highs.
DecenTrader expects a similar outlook, with Bitcoin poised to record new highs in the mid-to-late fourth quarter of 2024. In the near term the market may face volatile price action ahead and "a bit of FOMO towards the $49,000 level."
