The Bitcoin price has risen above $38,000 in the past few hours, and for the first time this year, a 4-hour candle has closed above this crucial price level – a very bullish sign that BTC may rise further. These are reasons behind BTC’s latest price rise:
#1 Awaiting Spot Bitcoin ETF Approval
The recent rise in the Bitcoin price can probably be attributed in part to developments surrounding the potential approval of a spot Bitcoin ETF. Bloomberg ETF analyst James Seyffart said on X: “Okay, the window for potential Bitcoin ETF approval looks like it will be between January 5th and January 10th, 2024.”
This observation follows the SEC’s announcement regarding the publication of the Franklin/Hashdex delays today, December 1st. Scott Johnsson, a lawyer at Davis Polk, agreed with Seyffart: “That leaves the comment period to end on January 5. Ark/21 shares deadline on January 10.”
Additionally, Nate Geraci of ETF Store brought further optimism with his comments yesterday, “Another meeting yesterday between Greyscale & SEC. Absolutely fascinated to see how this all plays out, especially the timing of GBTC listing versus the launch of competing spot BTC ETFs. Btw, if you’re tired of me tweeting about this, good news is I think we’re getting closer to the finish line.”
These developments suggest that a spot Bitcoin ETF is just a matter of when, not if. They also show a growing consensus between ETF applicants and the SEC, which only wants to refine all proposals before approving a batch or all 12 applicants (except Pando Asset) at once.
#2 MicroStrategy will buy more BTC
Another driver could be MicroStrategy’s unwavering commitment to Bitcoin. The company’s latest filing revealed an additional purchase of 16,130 BTC, which amounts to approximately $608 million. This acquisition, at an average price of about $36,785 per Bitcoin, takes MicroStrategy’s total holdings to 174,530 BTC.
More importantly, however, was the news that MicroStrategy is already planning its next Bitcoin purchases. The company has entered into an agreement to offer up to $750 million worth of Class A common stock, a move interpreted by many as preparation for further Bitcoin purchases.
This means that Saylor will buy even more BTC in the coming weeks or months, which will definitely have a positive impact on BTC price. The news is definitely positive for the price, while some traders may want to take it on.
#3 Market Dynamics
The current market dynamics surrounding Bitcoin’s price rise have been closely examined by leading crypto analysts, revealing nuanced insights into the behavior of market participants. Crypto analyst Skew highlighted a specific pattern in the buying behavior, indicating a strategic approach by market players.
He said: “Teems obvious who is bidding on the corn here. Open interest and Delta: Both longs and shorts seem to be chasing this move.” This comment suggests that both bullish and bearish traders are actively participating, leading to increased market volatility and price movement.
In addition, Skew pointed out specific activity on the Binance spot market: “Still sustained spot offer around mid-$38K area. Bids driven by placeholders and limit questions are filled. If buyers can maintain the bidding momentum and clear that offer, it may be looking for a limit chase after the bid for higher prices.
Byzantine General, another crypto analyst, found another major driver for the recent price action. He said: “Spot markets are still trading at a premium, not just Coinbase. And the fact that USD markets are consistently trading much higher than USDT markets makes me think that there may be some new money coming in.”
#4 Breakout Moves on lower time frames
From a technical point of view, crypto expert Scott Melker observed a breakout move on the lower time frames. He noted: “Bitcoin is breaking out on a low time frame. ” In the 15-minute chart, Bitcoin is trading within a descending channel, a pattern characterized by successive lower highs and lower lows. This typically reflects a bearish trend.
However, a few hours ago, the Bitcoin price managed to break above the upper limit of this channel, a move that is often interpreted as a potential reversal signal. The low timeframe breakout is significant for traders because it signals a shift in short-term sentiment, potentially setting the stage for a continued upward trajectory in the higher timeframes.
At press time, BTC was trading at $38,350.
Featured image from Unsplash / Kanchanara, chart from TradingView.com
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