Bitcoin Surges to Key Tech Levels on ETF Optimism as USD Deflates

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BTC/USD Analysis

The crypto industry has been under increased regulatory scrutiny in the US, but has managed to score some victories against the Securities and Exchange Commission (SEC). In late August, the District of Columbia Court of Appeals vacated the agency's decision to deny Grayscale's Bitcoin ETF proposal [1]. This could open the door to the launch of such products, with filings from more companies pending and the crypto industry is hopeful of a favorable outcome.

At the same time, the USDOLLAR is weighed by recent softer Fed rhetoric that undermine the higher-for-longer mantra and the pullback in bond yields. The US 10-yesar yields hit 5% for the first time since 2007, but pulls back from its peak.

These themes have propelled Ethereum higher and of course BTC/USD, which builds on last week's advance, with gains of around 14% since yesterday. It now tries to take out the critical 38.2% Fibonacci of its 2021 highs/2022 low slump (35,917) that will allow it to look to 40,048 and beyond.

On the other hand, the move appears exaggerated technically and failure to clear the key 38.2% could spark a pullback towards the 30K mark. There are multiple roadblocks after that though and a significant reversal in sentiment would be required for a return below EMA200.

The current week features many high profile events that can increase volatility and determine the trajectory of BTC/USD, highlighted by Friday's Us PCE inflation.

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Nikos Tzabouras

Senior Financial Editorial Writer

Nikos Tzabouras is a graduate of the Department of International & European Economic Studies at the Athens University of Economics and Business. He has a long time presence at FXCM, as he joined the company in 2011. He has served from multiple positions, but specializes in financial market analysis and commentary.

With his educational background in international relations, he emphasizes not only on Technical Analysis but also in Fundamental Analysis and Geopolitics – which have been having increasing impact on financial markets. He has longtime experience in market analysis and as a host of educational trading courses via online and in-person sessions and conferences.

References

1

Retrieved 18 May 2024 https://storage.courtlistener.com/recap/gov.uscourts.cadc.38827/gov.uscourts.cadc.38827.1208547574.0_2.pdf

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