After a short consolidation phase, Bitcoin managed to break the resistance at $59K without any particular problems, updating the local high at $62900.
Yesterday, the news that had been chasing for days about the imminent approval of a Bitcoin ETF by the SEC found confirmation, setting the dust on fire.
At the time of writing, the main cryptocurrency is trading around $61700, market capitalization up to $2500 billion and BTC dominance index at 47%.
Stock markets closed Friday's trading on the upside after a difficult week. Mass sentiment on equities is bearish and this could support an imminent recovery in the major indices. In fact, on the contrary, the smart money is optimistic about a recovery in the medium term.
On the crypto front, the news of the approval of the first ETF on BTC futures (Proshares Bitcoin Strategy ETF) has favored the technical breakout of the resistance at $59000 - link
At current prices, essentially 99% of Bitcoin holders are in the money and small retails investor sentiment is rapidly degenerating into FOMO.
In this regard, Open Interest data in crypto derivatives platforms show OI near guard levels, which have triggered violent pullbacks in the past.
In this context, the use of leverage is discouraged and, if you are not yet in a position, it is recommended to wait for a correction before proceeding to purchases.
This is neither the time to sell nor the time to buy.
The adoption of the Proshares ETF will result in a new flow of institutional money. The peculiarity of this instrument is that it is linked to the underlying BTC futures of the CME, so reasonably it will be used by institutional investors for arbitrage operations (in bull market phases, futures are traded in "contango", i.e. with a premium on the price).
So we are not yet in the presence of a real spot ETF in the US, which is the financial instrument that will really help the access to the crypto market of those part of retail investors who are not accustomed to technology, but I am convinced that we will not have to wait much longer to see one approved by the SEC.
From the short term point of view, we are very close to the previous all-time high of $64,854 and it is not excluded that already in the weekend we will have some tests. Anyway, it's only a matter of time.
In case of violent pullbacks, it is definitely the case to reinforce the positions on BTC and the top alts.
Let's not forget that in the weekend low volumes favor sudden spikes of volatility in every direction, so maximum caution in intraday trading.
Some interesting news to report.
Jack Dorsey, CEO of Twitter and Square, said that Square itself is working on a new Bitcoin mining system.
Australia's fifth largest pension fund, Queensland Investment Corporation, which manages $69 billion in savings, wants to invest in cryptocurrencies. I am sure that very soon, other pension funds will follow suit.
Thanks for reading and have a great weekend.