The potential approval of a spot Bitcoin-ETF in the United States could trigger a ‘sell the news’ scenario, exerting heavy pressure on the price of the leading cryptocurrency. The Block reports this, citing a CryptoQuant report.
Analysts pointed to data on ‘paper’ profits among market participants after Bitcoin breached the $40,000 mark as supporting the thesis.
“Short-term Bitcoin holders have high unrealized profits, around 30%. This has historically preceded price corrections,” the report notes.
In addition to traders, miners are also in the black. This is another potential bearish factor.
“Over the past few weeks we have seen growing selling among miners as the price stays above $40 000,” the analysts noted.
According to experts, during corrections in bull markets Bitcoin tends toward the realized price of short-term holders. Given this, in a “sell the news” scenario the drop could halt around $32 000.
MN Trading founder Michaël van de Poppe said that after a potential ETF approval, digital gold would reach a local high near $47,700. It would then trade in a wide range with a lower bound around $38,000.
#Bitcoin is probably getting topped out around the ETF approval and will move inside a range.
That range, and the recent week, is a signal for strength on the remainder of the markets to catch up.
Ethereum is likely to run to $3,000+. pic.twitter.com/4484VMm8Db
— Michaël van de Poppe (@CryptoMichNL) December 28, 2023
Such broad, sideways movement at relatively high levels will serve as a signal that the rest of the markets need to catch up, the analyst asserts. In particular, he forecast Ethereum reaching $3,000 at the start of next year.
Earlier, Morgan Creek Digital co-founder Anthony Pompliano expressed the view that approval by the SEC of the first spot Bitcoin ETF in the United States would not lead to a rapid rally in the price of the leading cryptocurrency.
Josef Tetek, a Trezor analyst called the potential launch of a new product a threat to digital gold.