On-chain analytics platform CryptoQuant believes that a deep corrective move is brewing for Bitcoin as the market eagerly anticipates the possible approval of spot-based BTC exchange-traded funds (ETFs).
In a research report, CryptoQuant says that the approval of Bitcoin ETFs sometime this month could be a sell-the-news event as BTC investors are now sitting on significant gains.
According to the on-chain data provider, traders might capitalize on the event to lock in their profits, which could lead to a Bitcoin correction.
“Market analysts are assigning 90% odds of Bitcoin spot ETF approval in the USA by January 8th to 10th, 2024. We argue that the ETF approval could be a ‘sell-the-news’ event as Bitcoin market participants are sitting on high unrealized profits.”
Should Bitcoin witness a correction following the U.S. Securities and Exchange Commission’s (SEC) approval of BTC ETFs, CryptoQuant predicts that Bitcoin could drop almost 30% from current prices based on one metric.
“In the scenario, the Bitcoin price may decline to as low as $32,000, the short-term holder (STH) realized price.”
The STH realized price is an on-chain metric that tracks the average price of acquisition of all the Bitcoin that have not moved for less than 155 days. A pullback toward the STH realized price at around $32,000 would wipe out most of the gains made by investors who bought BTC in the last five months or so.
At time of writing, Bitcoin is trading for $44,990, up over 5% in the last 24 hours.Don't Miss a Beat – Subscribe to get email alerts delivered directly to your inbox
Check Price Action
Follow us on Twitter, Facebook and Telegram
Surf The Daily Hodl Mix
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured Image: Shutterstock/Sensvector/EB Adventure Photography