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Bitcoin (BTC) Prices Fall Below $39,000 as ETF Debut Continues to Be a Sell-the-News Event
Bitcoin (BTC) fell below $39,000 during European trading hours on Tuesday, reversing nearly all of the past two months’ gains made in anticipation of exchange-traded fund (ETF) approvals in the United States
BTC fell nearly 5% in the past 24 hours, reaching its lowest level in two months. The CoinDesk 20, a liquid index of the largest tokens by market capitalization, fell by 7%.
The cryptocurrency recovered as high as $38,700 before recovering slightly. The token recently hit a two-year high of over $49,000 when spot bitcoin ETFs began trading in the US on January 11.
Some of the recent selling pressure on bitcoin has been traced back to sales from bankruptcy estate FTX, which has sold around 22 million shares of Grayscale’s GBTC in recent weeks, as reported by CoinDesk. On-chain analytics firm CryptoQuant was among the few contrarian bets that speculated that ETF approval would be a news sell event.
“Sell the news” is a well-known term in capital markets and describes how asset prices, leverage and sentiment push prices higher in the run-up to a bull event, only to cause prices to fall shortly thereafter. .
The approval of spot bitcoin ETFs in the U.S. was highly anticipated and well-priced, and the event “is likely to be a near- to medium-term high for the price,” analysts at CoinDesk told CoinDesk in an email. BitBank cryptocurrency exchange based in Japan. .
Earlier this month, analysts at 10X Research, led by Markus Thielen, said they expect bitcoin to fall to at least $38,000 in the near team, citing technical analysis. CryptoQuant’s target remains much lower, at $32,000.