Bitcoin accelerated the rises and traded above $ 51,000, its two-week high. The overcoming of this psychological zone was one of the bullish signals that the market expected.
The most popular cryptocurrency in the world overcame the omicron scare and the negative flow of news that reached the market this Friday, after it became known that the SEC just turned down two bitcoin-backed ETFs.
However, the return of risk appetite that encouraged global markets thanks to less severity of omicron, offset the negative headlines that came from the U.S.
The rest of digital currencies were not far behind either. The ether it skyrocketed more than 4 percent and regained $ 4,000, another benchmark level. In addition, the litecoin rose 6 percent and the chainlink 8 percent, for a 5 percent who won solana.
High correlation with risk assets
Analysts understood the upward movement of the bitcoin as a consequence of the appetite for risk that led the S & P500 to hit new highs this Thursday.
“When the appetite for risk increases, it goes up a lot (bitcoin). And when the appetite for risk decreases, it can go down a lot, “he said. Ross Mayfield, Market Strategist at Baird Broker.
The truth is that bitcoin has plunged more than 30 percent in recent weeks, after hitting all-time highs at $ 69,000 in early November. Following the theory of Mayfield, the tapering drums did a lot of damage.
The news that central banks around the world are considering a more restrictive turn to their monetary policies depressed all risk assets, including cryptocurrencies.
Quite the opposite has just happened now, just when the stock exchanges relativized the omicron risk after the strong evidence that points towards its lower severity.
Bullish Momentum Discounts More Advances
From a technical point of view, bitcoin made a double bottom at $ 46,800. This figure served to stabilize the falls.
In fact, according to experts from eToro, the range between $ 47,000 and $ 51,500 is the area where the big investors, the whales, have been buying after the latest setbacks.
In addition, bitcoin formed a flag figure, a technical pattern with bullish implications, which led the price to exceed its average of 20 sessions, a very short-term reference.
This suggests the possibility that “there will be more rises in the future,” with an advance target of between $ 53,000 and $ 55,000, analysts from Bloomberg Intelligence.
Along the same lines, the analysts of eToro They pointed out that bitcoin needs to clearly surpass the $ 50,000-51,000 zone to think about the next target, which they set at $ 58,000.
The SEC’s blow
This recovery movement of the bitcoin it is especially commendable considering that the SEC has just poured cold water on the expectations of institutional investors.
Specifically, the US market regulator rejected proposals to launch an ETF by Valkyrie Investments y Kryptoin. They do not meet the requirements to avoid fraudulent practices.
In mid-October, the SEC gave free rein to the Proshares bitcoin ETF, the first in the history of the United States, which moved more than $ 1 billion on the day of its release.
Just a month ago, the SEC also rejected VanEck’s request to launch a spot bitcoin ETF.
The deadline to make a decision on the two proposals of the two rejected funds was January 7. But the SEC’s rush to tear down these products does not bode well.
“We were optimistic, but we do not trust an approval in 2022,” he said about it. Eric Balchunas, analista de Bloomberg Intelligence.
The SEC’s decision on the Bitcoin spot ETF proposed by First Trust/Skybridge is expected on January 22. Next on the list is the background of Fidelity, whose verdict is expected on January 27.