ETF Twist: From Cointelegraph’s Error to BlackRock’s Leap
The Technical Take: Bitcoin Soaring Through Overbought Territory
Last week, an error made the headlines of most crypto news outlets and sent Bitcoin to $30,000. This week, that error could be proof that someone has a time machine… but let’s not get ahead of ourselves.
The short story goes like this: in a post by Cointelegraph on X (previously known as Twitter), it was announced that the U.S. Securities and Exchange Commission (SEC) has given the green light to the first spot Bitcoin ETF. This post was soon followed by an apology from Cointelegraph, saying that it was a mistake made by their social media team.
But this week, evidence has emerged that we are moving closer to seeing the first spot Bitcoin Exchange Traded Fund (ETF). BlackRock is leading the charge as their iShares spot BTC ETF has been listed on the Depository Trust & Clearing Corporation (DTCC). This move is widely regarded as a strong indication that BlackRock’s ETF will be soon approved.
According to Eric Balchunas, a Bloomberg ETF analyst, the DTCC listing is “all part of the process” of bringing this ETF to the market. If BlackRock’s proposal receives approval, it may pave the way for numerous spot crypto ETF applications awaiting the SEC’s review, such as those from ARK Investment, Valkyrie, Fidelity, and others. As of now, the SEC has yet to greenlight a spot Bitcoin or Ether ETF for U.S. exchange listing. However, the SEC began permitting investment products linked to Bitcoin futures in October 2021.
Chart Analysis – BTC/USD
The apex cryptocurrency is currently changing hands at $34,220 after reaching a high of $35,198. The last time Bitcoin reached this value was in May of 2022. The current year started with Bitcoin trading at around $16,000, which means that so far, it more than doubled in value.
We are in a sensitive period where even the slightest news surrounding the spot ETF craze can significantly shake the market. We’ve witnessed the impact of a single tweet (even if mistakenly posted) and the ripple effects of ETF approval rumors. Thus, one can only imagine the magnitude of reaction to an actual approval announcement.
If we are speaking strictly from a technical perspective, the pair is overbought and facing a major resistance level. The RSI is at 84, moving down from almost 88, which is extremely overbought territory and also an indication that a pullback will follow. The importance of $35,000 cannot be overstated, as this is at the same time a psychological and technical level.
With that being said, we should never underestimate Bitcoin’s ability to move higher despite overbought levels. But even if that is the case this time, keep your eyes on a possible pullback.
