(Kitco News) – The correction in the crypto market intensified overnight as Bitcoin (BTC) overpowered the bullish support at $67,000, pushing its high to a low of $62,460. As of this writing, the bulls are still in crisis, and the bears are currently trying to grab support at $62,000 on the way to the BTC price below $60,000.
BTC/USD Charts by TradingView
Altcoins took an even bigger hit, with many high flyers down 20-40% from recent highs as crypto traders take profits en masse and wait for the dust of this correction to settle.
Data provided by Coinglass shows that Bitcoin's relentless rise over the past three weeks has led many traders to believe that for the foreseeable future (usually only upswings are when we see big corrections), so longs are on the rise this time. Cryptoland is proving to be the biggest loser due to the decline.
The broad pullback comes as inflows into physical Bitcoin exchange traded funds (ETFs) turned negative for the first time since March 1 on Monday, largely due to Grayscale's 600 million yen increase from GBTC. The $42.5 million outflow was the largest single-day outflow on record.
Coin Tacky Derby became a day of negative flow #bitcoin Thanks to ETFs $GBTCThe day $643 million was leaked pic.twitter.com/scmVgmwtiH
— James Seyffert (@JSeyff) March 19, 2024
According to data provided by Farside, GBTC has currently recorded total outflows of over $12.4 billion, while BlackRocks IBIT has recorded inflows of $12.96 billion. In total, the ETF had net flows of $12 billion and currently holds 836,600 BTC worth approximately $53.1 billion.
Many crypto naysayers are now saying that the top of this bullish cycle has arrived, but the fact that the halving is still more than 30 days away tells us otherwise. This is because the typical cycle does not reach its peak for 6 to 9 months after the half-life.
While the inflows into ETFs have been impressive so far, this could be just the beginning, as the majority of investment advisors have yet to start recommending their clients allocate to Bitcoin.
according to Grant Engelbart, vice president and investment strategist at Carson Group, one of the first advisor platforms to introduce ETFs, says only a “handful” of advisors allocate to Bitcoin ETFs, and the average allocation is It is said that it was 3.5%.
Many analysts are now pointing to the halving as the next trigger for Bitcoin and the broader crypto market, and expect prices to remain flat until then.
“Bitcoin is now more important than ever as an institutional asset,” Henry Robinson, co-founder and head of crypto at Decimal Digital Currency, said in a note shared with Kitco Crypto. says. “New Bitcoin ETFs are recording 9-10 digit net inflows weekly, holding over 400,000 BTC, over 800,000 when including GBTC, and over 1 million when including MicroStrategy.”
“We're already seeing this build-up starting to impact prices,” he said. “At current prices, the post-halving impact will soon mean about $800 million less in new monthly BTC supply. means,” he said. “We expect it to reach a new all-time high in 2024.”
Referring to the large losses of derivatives traders, Robinson said, “When everyone believes that profits are guaranteed and sentiment is very bullish, leveraged traders tend to be weeded out.” emphasized. I wouldn't be surprised to see this correction ahead of the halving, liquidating more extreme bullish bets before continuing the rally, but I would definitely call something like this a “buy on the buy” opportunity. ”
“The BTC market is getting smarter and deeper pockets. This new liquidity from ETFs makes BTC pricing more rational and discourages market manipulation,” he said. “More importantly, Bitcoin ETFs have created an on-ramp to educate traditional asset managers about Bitcoin, which they may have previously ignored out of caution or due to regulatory constraints. But now more people are looking into it and will see an incredible risk/reward ratio. Adoption is just beginning.”
“The market is clearly trying to accumulate large amounts of Bitcoin, but it will take time for price movements to follow local supply and demand,” Robinson concluded. “We could see frenzied bullish moves, dramatic declines, or both before and after the halving, as market participants move in and out of halving bets.”
And for those less familiar with the crypto bull market and the volatility that comes with it, market analyst Recto Capital offers the following advice on when to expect the Bitcoin bull market to resume: He gave it to me.
Bitcoin will reverse deep enough to convince us the bull market is over
and returns to an upward trend$BTC #BTC #bitcoin
— Rect Capital (@rektcapital) March 19, 2024
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