Is The Link Broken? New Analysis Shows Bitcoin’s Price Unmoved By ETF Liquidations
15 Agosto 2024 - 5:00AM
NEWSBTC
The evolvement of Bitcoin has led to Bitcoin’s trajectory being
linked to several other markets, whereby the stance of certain
markets could hint at where BTC is headed. However, according to
the latest data, this phenomenon is changing specifically for the
correlation of Bitcoin’s price to exchange-traded fund (ETF)
movements. Related Reading: Is Now the Time to Buy Bitcoin? Top
Analysts Predict $150K Surge On The Horizon Historical Patterns And
Recent Deviations The latest observation from a CryptoQuant author
on the QuickTake platform has revealed that BTC ETF, particularly
the ETC Group Physical Bitcoin (BTCE), an investment fund based in
Germany, which has shown a historical pattern of syncing with
Bitcoin’s price movements, is now seeing a divergence in
correlation. The analyst, Joao Wedson, disclosed that historically,
increases in BTCE’s Bitcoin holdings have often aligned with
substantial price rallies in Bitcoin itself. For instance, a
significant accumulation in the fund’s reserves from 0 to over
23,480 BTC in 2020 coincided with Bitcoin’s surge to its first
historic peak in April 2021. Conversely, a reduction in holdings
has typically indicated a forthcoming drop in Bitcoin prices.
Recent Trends and Changes in Fund Behavior “The historical
correlation between BTCE and the Bitcoin price has shown a
consistent pattern, where changes in the fund’s reserves generally
precede movements in $BTC price.” – By @joao_wedson Link
👇https://t.co/59rWi28opD pic.twitter.com/bKRI4TfePP —
CryptoQuant.com (@cryptoquant_com) August 14, 2024 However, a shift
in this pattern has been observed since January 2024. Despite the
fund’s Bitcoin reserves decreasing from a peak of 27,980 BTC to
below 17,000 BTC, the anticipated decline in Bitcoin’s price hasn’t
materialized to the extent predicted by past trends. This
divergence suggests a potential decoupling of the fund’s activities
from direct Bitcoin price movements, marking a change in how BTC’s
market relation with this product might be interpreted. Wedson
revealed that this observation is evident in the 30-day variance of
the BTCE fund analysis. This analysis showed that positive
variances in the fund’s reserves were typically associated with
Bitcoin price rises, and negative variances correlated with price
drops. The recent period, however, stands as an exception to these
findings, with Bitcoin’s price rising despite continued sell-offs
from the fund. Bitcoin Market Performance And Future Outlook
Bitcoin is trading for $59,144 at the time of writing, following a
3.6% dip in the past 24 hours. According to the latest report,
this decline comes after the US inflation fell to 2.9%, the lowest
since 2021. Amid this price performance, Economist and
Trader Mikybull Crypto on X, has pointed out
the potential rally for Bitcoin. Related Reading: Is Bitcoin
Headed For A Rally Or Ruin? This Key Price Point Could Decide This
rally, according to the analyst is based on the global liquidity
index breaking out of a 2-year resistance. Mikybull Crypto noted:
The BTC correlation with the global liquidity index is quite
strong. This indicates that Bitcoin strong and massive rally is
looming. Featured image created with DALL-E, Chart from TradingView
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