Bitcoin was in the range of 38070-389999 during the day
Consolidation above 38500-38600 has occurred and remains above these levels for more than 12 hours.
Crypto market capitalization 1.42 trillion, dominance index 53.29%, fear index 74.
Over the past week, Bitcoin, after several setbacks, was able to first consolidate above 38K and then overcome the resistance area at 38400-38600
Once again, the annual maximum was updated, now it is 38999. Bitcoin has not been at these levels since August 2022.
The main reason for growth is the expectation of a positive SEC decision on BTC-ETF. According to information from Bloomberg, the decision window will be from January 5 to January 10, 2024.
Approval on these dates looks logical (I always said that it would be approved in 2024).
Movements around ETFs are just a reason for market movements. Therefore, BlackRock and the company simply want to skim the cream off what is already inevitable. We will discuss what scenarios with ETFs are possible separately (and it is unlikely to be just linear growth)).
The correlation with the S&P 500 has dropped to a minimum (it has grown very slightly over the past week). But an inverse correlation with the dollar index has been visible in the last couple of days.
What to expect in the near future?
Fall factors:
1. Bitcoin is growing, but everything else is in place. Even Ether can’t reach 2100. The dominance index grew by 1% over the week, as did the market capitalization. That is, capitalization grows only due to Bitcoin.
If the alts do not change the situation over the weekend, it will be in favor of a quick trip to refuel.
If Ether reaches 2100, we expect alts to grow by 10-20% this weekend. And this factor is becoming less relevant.
2. Greed index at extreme values for the year. It was higher only in the fall of 2021. This is a sign of consensus and not a good signal for the market in the short term. Although, while there has been no real growth in alts, I don’t expect a big drop. And a drop of 15-20% for alts is not a drain, but simply a movement).
3. High probability of falsehoods (FUD about different exchanges, the first candidate is ByBit, falsehoods that there will be no ETF, etc.). Can serve as a basis for a trip to refuel.
4. Possible upward rebound in the dollar index. So far there are no particular reasons, but geopolitics can throw them up.
Growth factors.
1. According to the logic of market cycles, if Bitcoin is held at current levels over the weekend, alts are likely to rise. The main sign of the scenario is the consolidation of Ethereum above 2100 and a decrease in the dominance index. TOP alts will increase by 10-20%.
This option is in favor of market growth.
2. Bitcoin is bought and held. It is difficult to present arguments in favor of selling Bitcoin right now. Even those who don’t particularly believe in Bitcoin and don’t understand how it differs from all other assets will hold it in anticipation of growth after the news of the ETF’s approval. Then such an audience will be a factor in the short-term decline. But for now it ensures high demand and a reduction in supply for Bitcoin.
If there is no one in particular to drain Bitcoin, then how will it fall?)
I think that now the local bottom is support at 35000-34800. And you need a good reason to go there. Violas, of course, in such a scenario will be declassed). But only for a while.
3. All medium-term Bitcoin growth factors (from halving and ETFs to macroeconomics and privacy) are in force. Therefore, there may be small corrections, but the direction of movement is quite obvious.
4. There may be news about the adoption of Bitcoin in a number of countries (following the example of El Salvador). The main candidate is Argentina, but not only.
Therefore, I consider Bitcoin to achieve its goals for the year (40,000-42,000) by the end of the year as a priority option.
The priority option for the weekend is Bitcoin in a range with a lower limit at 38200-38000 and an upper limit at 38900-39100
An alternative option is to consolidate above 39100
