The cryptocurrency markets have been highly volatile in the last 24 hours, with a sudden shift in sentiment due to a rumor regarding the SEC’s approval of a spot Bitcoin ETF. The anticipation was high for an approval by January 10th, but a report by Matrixport analysts suggesting a likely rejection by the SEC caused a swift change in opinions.
Significant macroeconomic data is expected to be released on Friday, and the Fed minutes from January 3rd indicated some members’ insistence on delayed interest rate cuts, casting a negative light on the market outlook. Despite this, Bloomberg ETF analyst James Seyffart still sees a 90% chance of ETF approval by January 10th, and recent meetings between the SEC and exchanges to discuss the Spot Bitcoin ETF have made the stance of those expecting a rejection seem illogical.
Bitcoin’s price managed to surpass the $44,700 resistance on January 2nd but fell back the next day, turning the breakout into a potential bull trap. Buyers stepping in to purchase the dip towards the 50-day simple moving average at $40,938 reflects the bulls’ determination to defend the $40,000 region.
Should Bitcoin lose the $40,000 support, short-term deeper lows could be in sight, with the first support at $37,980. However, if buyers can push the spot price above $45,879, a continued rise and a test of the $50,000 level could be expected.
Ethereum (ETH) bulls attempted to push the price above the $2,445 resistance on January 2nd but were affected by the same factors impacting BTC. The sudden shifts in general market sentiment coincided with critical stages for ETH, which has been unable to initiate the long-awaited upward movement while remaining at low levels against BTC.
ETH’s price showed a sharp decline on January 3rd, falling below the moving averages. A silver lining is buyers purchasing the dip at $2,100, managing to hold the price around $2,200 at the time of writing. If resistance can be breached in the next attempt, the price could aim for the $3,000 and $3,500 resistance levels, while a bearish scenario could see a gradual decline to $1,900.