Bitcoin rebounds to $98,000, confirms support on the downside, but adjustment risk persists.

## Macroeconomics and Financial Markets

On the 24th, the NY stock market closed with the Dow Jones Industrial Average up 390 points (+0.91%) to 43,297 and the Nasdaq composite up 1.3% to 20,031 points.

US cryptocurrency-related stocks rebounded with Bitcoin (BTC), with Coinbase rising +4.2% to $279.6 and MicroStrategy rising +7.8% to $358.1 compared to the previous day.

In related stocks of Japanese stocks, Monex, Seres, and Metaplanet are rebounding.

Cryptocurrency market conditions

In the cryptocurrency market, Bitcoin (BTC) is at 1 BTC = $98,165, up 4.6% from the previous day.

Weekly BTC/USD

In addition to the recoil safety after updating the highest price in the past, concerns about selling at the end of the year for tax adjustment and position adjustment, selling has been leading in the current situation, and there were concerns about a long-term adjustment phase and a reversal of the downward trend. However, the buying momentum increased as it withstood the support line at $92,000.

In the futures market, which was overheated until the other day, there were forced liquidations of long positions exceeding $2 billion from the 18th to the 20th, and improvements in the supply-demand situation can be seen.

In past cycles, in bullish markets, there has been a sell-off before the Christmas season to secure profits, followed by a recovery in price movement.

However, the adjustment of risk assets, including the stock market, was caused by the interest rate outlook at the Federal Open Market Committee (FOMC) and the hawkish comments of Powell, the chairman of the Federal Reserve Board (FRB), and it is unlikely that the cryptocurrency market will have independent price movements during the year-end and New Year holidays, and it is expected to be highly dependent on the US stock index.

As Mr. Nishi explains, analysis of the options market has confirmed a deterioration in investor sentiment, and it seems that this is a situation that we should continue to pay attention to.

Possibility of entering an adjustment phase?

There is also a bearish view in the medium term.

Renowned analyst Benjamin Cohen has pointed out the short-term adjustment risk of Bitcoin. The deviation from the 20-week Simple Moving Average (SMA) has reached levels similar to previous adjustment phases.

According to Mr. Cohen, the support range in case of adjustment is between $72,000 and $80,000. This corresponds to the ‘Bull Market Support Band’ formed by the 20-week SMA and the 21-week Exponential Moving Average (EMA).

In addition, he also suggests the possibility of a larger correction. Analyzing past patterns, he argues that it may be necessary to consider a drop to the $60,000 range. In past markets, it has been confirmed that after a breakout of the trend line, there is a temporary decline, followed by a continuation of the upward trend.

According to market participants, even if a correction occurs, the upward trend formed after August 2023 is being maintained, and there is a high possibility of buying support at the support band.

▼Bitcoin｜Investment Information & Price Chart

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Altcoin Market

In the U.S. cryptocurrency ETF market, there are also signs of fund shifts.

According to Coinglass data, as of the 23rd, the Ethereum ETF recorded a net inflow of $130.8 million. On the other hand, a capital outflow of $226.5 million was confirmed from the Bitcoin ETF.

! [ ] (https://imgs.coinpost-ext.com/uploads/2024/12/Ethereum-ETFs-inflows-1.png) In terms of inflows into Ethereum ETFs, BlackRock’s iShares Ethereum Trust (ETHA) was $89.5 million, Fidelity’s Ethereum ETF (FETH) was $4, It raised $6.4 million. This trend continued into December, with a single-day net inflow of $273.7 million on December 12. Positive inflows have continued for 14 consecutive days.

Although it may be too early to tell, some are beginning to suggest that if this shift in funding continues, it could indicate the arrival of the altcoin season in 2025.

However, when looking at the strength and weakness of currencies denominated in Bitcoin (BTC), it has been steadily declining on an annual basis as institutional investors increase. Therefore, it is unlikely to expect the same level of anticipation as in past alt seasons until ETH/BTC hits bottom and reverses.

ETH/BTC weekly chart

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• CoinPost (Cryptocurrency Media) (@coin_post) September 27, 2024

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