Is the next short-term target for Bitcoin $50,000?

By Mary Liu, BitpushNews

Boosted by the sentiment of the approval of the US spot Bitcoin ETF, Bitcoin broke through $47,000 during the Monday US stock trading session, reaching a nearly 20-month high. The last time the BTC trading price exceeded $46,000 was in April 2022.

Data from Bitpush shows that around 2:15 pm Eastern Time on January 8th, the price of Bitcoin broke through $47,000, with a 24-hour increase of 6.85%.

Cryptocurrency-related stocks also rose in response. Coinbase saw a slight increase of nearly 2%, Iris Energy and Marathon Digital rose by over 7%, Riot Platforms rose by 6%, and CleanSpark rose by 5%.

Coinglass data shows that the 24-hour liquidation amount of Bitcoin short positions exceeded $89 million, and as of the time of writing, this number is still increasing. The total liquidation amount of cryptocurrency short positions exceeded $150 million.

As the market eagerly awaits the SEC's decision on multiple ETF applications, expectations for its impact on institutional participation and the overall market dynamics are high.

At this time of the rise, BlackRock, Grayscale, and other potential Bitcoin ETF issuers submitted final updates to the SEC, including key fee disclosures, which enhanced investors' confidence in the likelihood of approval. This Wednesday, the final deadline for the SEC to approve or reject ETFs is approaching, and industry experts generally expect the agency to approve several applications to balance the competitive environment.

Jim Angel, Associate Professor at Georgetown University's McDonough School of Business, told CNBC, "This is a price war, with multiple applicants launching almost identical commoditized products, and their only competitive way is through pricing."

Former SEC Chairman Jay Clayton said on CNBC's "Squawk Box" program on Monday, "Approval is inevitable. There is nothing to decide… This is not only a big step for Bitcoin, but also for the entire financial industry."

The optimistic sentiment surrounding Bitcoin has driven Ethereum up by 3%. Several companies vying for Bitcoin ETFs have also submitted applications to launch spot Ethereum ETFs, with the final deadline for the decision expected later this year.

Is the next short-term target for Bitcoin $50,000?

Cryptocurrency analyst ArslanAli pointed out on Platform X that key technical indicators show that Bitcoin's mid-term support is at $45,900. The immediate resistance is at $48,420, followed by resistance at $50,000 and $51,375, marking potential obstacles for further price increases.

If there is a downward consolidation, the support levels are at $44,520, followed by $42,925 and $41,500, which may provide support as the price falls.

In addition, Bitcoin's Relative Strength Index (RSI) is currently at 76, indicating that the asset is in overbought territory. Such high RSI levels typically indicate that a price correction may be imminent.

Joel Kruger, Market Strategist at LMAX Group, released a report stating that if the SEC truly approves the ETF, the announcement could push up the price of Bitcoin. Kruger said, "Under the impetus of sideline capital, approval could trigger a 10-15% increase. If not approved, the forecast suggests that there may be a correction, but strong support is expected above $30,000."

A report released today by Standard Chartered Bank shows that a spot Bitcoin ETF could bring in as much as $100 billion in new capital inflows for the entire year of 2024, potentially driving the price of Bitcoin to $200,000 by the end of the year.

Matrixport believes that Bitcoin may experience another downward consolidation, as there are signs that "smart" money is once again exerting selling pressure, and funding rates are weakening. The recent market adjustment may not completely eliminate the downside risk, and BTC may retest the price range of $36,000 to $38,000.

Arthur Hayes, Co-founder of BitMEX, believes that the approval of a spot Bitcoin ETF could propel Bitcoin to soar to $70,000. However, he made a cautious prediction about a subsequent significant correction. Hayes said that based on the prices from early March, a "healthy" 20% to 30% retracement is reasonable, and if Bitcoin reaches the range of $60,000 to $70,000 in the coming weeks, the decline could be as high as 40%. He further predicted that Bitcoin would initially experience a significant decline alongside the broader financial markets, but due to its status as a "neutral reserve hard currency," it would rebound again before the Federal Reserve's interest rate meeting.

Despite the differing predictions on price trends, analysts unanimously believe that there is high demand for Bitcoin ETFs from both institutions and retail investors, and they are optimistic about their prospects. ETF expert Nate Geraci expects that a spot Bitcoin ETF will surpass the issuance records of all previous ETFs. Galaxy Digital estimates that the potential market size in the first year after the launch of a US Bitcoin ETF will be around $14 trillion, expanding to $26 trillion in the second year, and reaching $39 trillion in the third year.

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