- Bitcoin’s gains have largely come with optimism that U.S. regulators will approve the first spot Bitcoin exchange-traded fund (ETF) in the near future.
- In addition to ETF hopes, Bitcoin is supported by an improving macroeconomic backdrop that similarly backs the Dow Jones Industrial Average and S&P 500.
- Beyond Bitcoin, the second-largest crypto, Ether, fell by 1.5%, dropping to $2,020. Smaller tokens or altcoins were also weak.
While Bitcoin’s price continued to face pressure on Tuesday, market participants remain confident in Bitcoin.
Bitcoin Price Continues to Face Pressure
Bitcoin and other cryptocurrencies retreated on Tuesday, pulling back from recent highs, but crypto traders insist that both fundamental and technical factors continue to support bullish market sentiment.
Bitcoin’s price fell by 1% over the last 24 hours to $37,180. The largest digital asset reached an 18-month high last week, surpassing $38,000, but this rally has propelled prices up by more than 30% since early October.
Bitcoin’s gains have largely come with optimism that U.S. regulators will approve the first spot Bitcoin exchange-traded fund (ETF) in the near future, with expectations that this move will bring a wave of new investor interest to crypto.
Leo Mizuhara, CEO of Hashnote, said, “Even if one or more of these ETFs are not approved, Bitcoin could soon surpass $45,000. Momentum is building, and investors see declines as an accumulation time.”
In addition to hopes for ETFs, Bitcoin is supported by an improving macroeconomic backdrop that similarly backs the Dow Jones Industrial Average and S&P 500. Investors have increased confidence that the Federal Reserve has completed its process of raising interest rates and may lower borrowing costs in early next year, which could particularly support risk-sensitive bets such as tokens and technology shares.
How will Bitcoin overcome consolidation?
According to analysts, the technical picture is also strong, with Bitcoin currently showing a solid stance above a series of key levels, even as prices take a breather. Katie Stockton, Managing Partner at Fairlead Strategies, said:
“Bitcoin is in a short-term consolidation phase. Bitcoin will resolve the consolidation phase with a move around $38,000, serving as a catalyst for a test towards $42,200… Our long-term indicators have improved, but they are not definitively bullish yet. A breakout around $42,200 will confirm a long-term bullish reversal.”
Beyond Bitcoin, the second-largest crypto, Ether, fell by 1.5%, dropping to $2,020. Smaller tokens or altcoins were also weak, with Cardano falling 3%, Polygon down 2%, and meme coins experiencing sharp declines, with Dogecoin falling 3% and Shiba Inu losing 4%.
