Bitcoin (BTC)’s 50-day moving average (MA) has emerged as a key resistance line for the world’s largest cryptocurrency following the approval of spot-bitcoin exchange-traded funds (ETFs) in the US.
The 50-day MA is a composite of bitcoin’s last 50 closing prices and can act as a barrier to upward price action, as traders often use it as a sell-side signal.
Bitcoin fell below the 50-day MA for the first time in three months following last week’s landmark ETF approvals, but has struggled to move higher since.
Indicatively, the BTC/USD pair briefly hit an intraday high of $43,400 on Monday before closing at $42,500, slightly below the 50-day MA.
The remained subdued this morning, though some positive price action was observed when the European trading session commenced.
Bitcoin falls below 50-day MA – Source: binance.com
Bitcoin’s lagging performance in the post-ETF trading environment surprised some who were expecting an imminent bull run but were instead faced with a ‘sell-the-news’ situation, as much of the hype was already baked into bitcoin’s spot price.
Yet bitcoin ETFs had a demonstrably successful US launch, with Bloomberg’s senior ETF analyst Eric Balchunas noting $1.4 billion in new cash flowing into newly launched ETFs from the likes of BlackRock Inc (NYSE:NYSE:BLK), Fidelity and Bitwise in the first two days of trading.
This was slightly offset by $579 million in outflows from the Grayscale Bitcoin Trust, which Balchunas said could have been due to an accounting anomaly.
LATEST: With two days in the books, the Nine Newborns have taken in +$1.4b in new cash, overwhelming $GBTC's -$579m of outflows for net total of +$819m. $IBIT now leading pack w/ half a bil, Fidelity close second tho. The newborns' $3.6b in trading volume on 500k indiv trades… pic.twitter.com/b7U5DjENaw— Eric Balchunas (@EricBalchunas) January 13, 2024
Binance’s order book confirms a substantial amount of bitcoin sell orders at $43,000, which is slightly above the 50-day MA. The bulls will be hoping to break above this level in the near term.
In a rare instance, Ethereum (ETH) has steered ahead of bitcoin, having gained more than 18% against the benchmark cryptocurrency in the past seven days.
The ETH/USD pair was swapping for $2,717 at the time of writing.
ETH’s outperformance has hit bitcoin’s market dominance, which currently stands at 51.5%, a full 600 basis points lower week on week.
Global cryptocurrency market capitalisation is currently $1.69 trillion.
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