GBTC outflows decrease by 50%; Bitcoin Price Edge Above $43K

Bitcoin surged above $43,000 on January 29 as the market attempted to bounce back from the BTC exchange-traded fund (ETF) sell-off that occurred over the past 20 days.

At the time of writing, the BTC price was trading at $43,365, up 3% on the day. Its total value was once again above the $850 billion mark, confirming its top position as the largest cryptocurrency by market capitalization according to the CoinMarketCap ranking.

Bitcoin ETFs overshadow GTC outflows

Bitcoin’s price performance comes as the market experiences a slowdown in outflows for Grayscale’s GBTC spot ETF.

Data shows that Bitcoin ETF outflows from GBTC totaled $360 million on January 29, a 20% decrease from the daily count on Friday, January 26 and about 50% off the daily peak outflow.

Today’s #Bitcoin sent out by $GBTC/Gryscale is worth ~8.6K $BTC or ~$360M. Another decrease from last Friday and about half of what was sent before. I think it’s safe to assume that flow (on both sides) will slowly cool from here. https://t.co/wEbbkX6eRU pic.twitter.com/2gtai2dYlK

— Daan Crypto Trades (@DaanCrypto) January 29, 2024

Bloomberg Intelligence analyst James Seyffart also noted that more than $5 billion has left GBTC since its January 11 conversion to an ETF. GBTC outflow

Meanwhile, BlackRock’s iShares Bitcoin Trust (iBIT) ETF held more than 52,000 BTC worth more than $2 billion on the day.

🚨 BREAKING: BlackRock’s iShares Bitcoin ETF (IBIT) makes history, reaches $2 billion in assets under management, leading recently launched bitcoin products. A significant milestone for #Bitcoin and #ETFs. #CryptoNews 📈 $BTC pic.twitter.com/66M1s7k411

— Ryù (@Ryu_Tenchi) January 29, 2024

The figures were shared widely on social media, with user OS.PT saying it was a sign of “strong demand from the bull side”.

Bitcoin shorts get rect

Independent analyst Berit said in a Jan. 29 post on X that “$81 million worth of #crypto liquidations occurred in the last 24 hours,” most of which were long positions.

About $81 million worth of #crypto liquidations took place in the last 24 hours. In the last 24 hours, 36,534 traders were liquidated, with a total of $81 million worth of crypto liquidations in the last 24 hours, of which $56.8 million were long and $24.2 short. positions. pic.twitter.com/mNd9DivnPK

— 🔸BΞRIT🔸 (@Berit1p) January 29, 2024

Berit’s observation could have preceded BTC’s return above $43,000, a move that appeared to set a trap for bears hoping to catch the price below $40,000.

Data from CoinGlass shows long position liquidations for the entire crypto market totaling $68.87 million as of January 29. Bitcoin short liquidations totaled over $33.9 million versus $7.7 million long liquidations.

Total Crypto Liquidations. Source: Coinglass

The current market trend is a reason for optimism among crypto investors and traders, who hope to see Bitcoin begin an upward trend even as the halving approaches.

This renewed hope is seen in the increase in the Crypto Fear and Greed Index, which has moved back into the “greed” zone, an increase from the “neutral” area in which it spent most of last week.

Crypto Fear and Greed Index. Source: Alternative.me

Bitcoin’s V-shaped recovery could take BTC price to $50,000

BTC’s price action led to the appearance of a V-shaped recovery pattern on the daily chart.

A V-shaped recovery is a quick, sharp improvement in the price of an asset after a sharp decline. It is completed when the price returns to the level before the start of the downtrend.

In the case of Bitcoin, this level is the $47,200 level, which, if surpassed, will confirm a bullish breakout for the major crypto. The $48,000 level will hold a key resistance area for the price, with the bulls targeting a return to $50,000, levels last seen in December 2021. If this happens, it will represent a 15% increase from the current price.

BTC/USD Daily Chart. Source: TradingView

The moving averages and the relative strength index pointed upwards, adding credibility to the positive outlook. The price strength at 55 indicates that the buyers have started to dominate the market again.

On the downside, Bitcoin’s price could turn away from current levels, with the first major support emerging from $42,000 and another at $40,000. Lower than that, BTC could drop to retest the V-shape bottom at $38,500.