Charles Edwards, the founder of hedge fund Capriole Investments, offered an in-depth analysis of the Bitcoin market yesterday. His review offers a granular perspective on the aftermath of the historic ETF launches, the pivotal role of major players like Grayscale, and the interplay of market mechanics shaping Bitcoin’s trajectory.
Bitcoin Market Summary: ETF Launch
Edwards acknowledged the ETF launches as a pivotal moment, characterizing it as “ETF Mania.” He emphasized the hindsight realization that the ETF launch triggered a short-term “sell the news event.” Edwards elucidated, “A portion of this can be attributed to the Grayscale outflows of over $4B, approximately half of which was forced selling by the FTX bankruptcy estate and another couple billion likely to cover Grayscale’s debt obligations.”
However, he projects a shift in the outflow rate from Grayscale, stating, “I expect the current rate of outflow will drop to a more sustainable trickle over the next few weeks (after another few billion out).” Edwards also highlighted the end of Grayscale’s multi-year lock-up period, allowing long-term investors to finally close their GBTC positions at market prices.
Regarding Blackrock and Fidelity ETFs, Edwards noted their significance, saying, “The brand names of these two behemoths in the traditional asset management space means every billion they bring in, adds an order of magnitude more credibility (and therefore flows) into Bitcoin and crypto as a whole.”
BTC Technical Analysis
In his high timeframe technicals (HTF) analysis, Edwards observed a strong rejection at mid-range resistance during the ETF launch. He pointed out, “The nearest HTF support at $35K would likely represent a great opportunity to get long for the 2024 Halving year (if we are lucky enough to get there).” Edwards also mentioned, “Alternatively, a strong close above $44K will likely see the trend continue to range highs ($60K).”
For low timeframe technicals (LTF), he dissected the December/January consolidation and the $44K “fakeout” during the ETF launch. Edwards explained, “Fakeouts often resolve in price movements to the other side of the range, as we saw.” He added:
Therefore, the most interesting price point locally is $41K. A daily close above $41K would likely represent a downtrend fakeout and a swift return to range high at $44K (+). If we simply…
Click Here to Read the Full Original Article at NewsBTC…
