Namaste to all Traders and Investors.
After a long wait, Bitcoin ETF got approved and began its trading journey in US. Till a day before this approval, Bitcoin was firmly trading near $46k. But right after this news, Bitcoin fell by almost 10% on Friday. The reason is the enthusiasm of investors for Bitcoin ETF. Imagine, for investors who would have invested in Bitcoin at the beginning of 2023, Bitcoin reaching above 48000 (2-year high) was a good place to book 100% profits, especially when there is a new opportunity available in the same asset.
[Source.](Image by fabrikasimf on Freepik)
But now the question is whether this pressure on Bitcoin prices will last for a long time.
Well, fundamental analysis is not my forte but If we try to understand the overall psychology of the market participants, then due to this euphoria for Bitcoin ETF and new investment opportunities, funds outflow may continue, which may impact Bitcoin prices for a while. But since these new investment opportunities are directly related to Bitcoin, fundamentally there should be no reduction in its strength. Rather, this is good news, we may see a stagnation in the prices of Bitcoin for some time.
Technically reading its chart price action I can say that last Friday's selling was not done by weak investors but by big players. I tell you why I am saying this, remember in my previous analysis I talked about candle wicks, where the last few selling candles were considered weak looking at their long lower wick and the next day's buying momentum.
Source.
A candle holds a lot of information in itself. If there was strength in the selling, the candle would have been bigger and the price would have remained at the lower level till the end of the day. Simply because the sellers dominate the buyers the whole day. Which is exactly what happened on Friday.
According to our previous analysis, Bitcoin was trading in a trend and even after the fall last Friday, we saw some buying in Bitcoin following almost the same trend which you can understand by looking at the image above.
Now technically, as long as the price remains following this trend it will remain strong. If it breaks, 40K can be seen acting as a major support.
That's all for today.
Hope you learned something good!
English is not my first language. So sometimes I use 'Google Translate'. Please don't think that anything I have written in this blog has been copied from somewhere or is AI-generated.
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