- Bitcoin price is likely to correct to $50,000 or $48,000 after failing to hold above the 70.5% Fibonacci retracement level at $54,182.
- This descent will set the stage for a run-up to the next psychological level at $60,000.
- On-chain metrics reveal holders in profit have increased, supporting the short-term correction thesis.
Bitcoin price has positioned itself for a correction after the recent uptick in buying pressure. While the uptick made sense from a technical perspective, the rate of the uptrend did not and could be attributed to the renewed hype around the approval of a futures ETF.
Regulation plays catch-up with adoption
Bitcoin adoption in 2021 has been stellar. From increased usage of BTC in El Salvador to rising BTC ATM installations, the future for Bitcoin looks bright. Although the adoption began with retail, institutions have started taking a second look at BTC. A note shared by JPMorgan to its clients on October 7 revealed that these institutions are looking at BTC as a hedge against inflation instead of gold.
With such an increased interest in Bitcoin, the approval of a Bitcoin ETF makes sense, considering it will allow large investors to gain exposure to BTC without actually holding it. According to Bloomberg analysts, there is a 75% chance that the SEC will approve a futures Bitcoin ETF in October.
If true, this could trigger a bull run in Q4, allowing the ecosystem to recuperate after the May 19 crash. However, some whales do not want to wait or get left behind in the race.
CryptoQuant CEO Ki Young Ju tweeted that an investor(s) purchased “$1.6B worth $BTC via market orders in just 5 minutes.”
Popular analyst Alex Kruger suggested the cryptocurrency markets are trending higher due to the ETF anticipation.
This is what crypto markets are trading now. The dominant narrative is a bitcoin ETF. Dissapoint or not, can worry about that later. https://t.co/aIv3BFZqI4
— Alex Krüger (@krugermacro) October 6, 2021
