Technical indicators suggest BTC falling to $38,000 | CoinDesk JAPAN

Bitcoin (BTC) has fallen more than 5% since the spot exchange-traded fund (ETF) debuted in the U.S. on January 11, in what appears to be a classic “sell on the news” price move, dropping to $42,600. It was around the dollar.

In the short term, this sell-off is likely to continue, according to 10x Research’s analysis of Bitcoin price patterns and technical indicators.

“Bitcoin’s RSI divergence signals a correction,” 10x Research, led by Markus Thiele, said in a note to clients on Monday, pointing to a pullback near the dynamic support level of $38,000. He adds that it is possible.

A bearish divergence (a condition in which technical indicators are moving in the opposite direction to the actual market price) occurs when price reaches a new extreme and momentum indicators such as the Relative Strength Index (RSI) do not. This suggests that the upside has dried up.

BTC hit a two-year high above $49,000 last week, but the 14-day RSI did not confirm this. The subsequent price decline confirmed a bearish divergence.

The RSI fell last week when BTC broke above $49,000 for the first time since December 2021. (TradingView/CoinDesk)

The MACD histogram, used to measure trend strength and change, also fell below zero, suggesting a bearish turn in momentum.

Investors in Grayscale’s ETF, the Grayscale Bitcoin Trust (GBTC), switching to other lower-fee options will likely weigh on the price of Bitcoin, according to Thielen. . Grayscale charges 1.5%, while other asset managers such as BlackRock charge 0.25%. GBTC, formerly a closed-end trust, is one of the largest Bitcoin holders with over $27 billion (approximately 3.9 trillion yen, equivalent to 1 dollar = 145 yen) of coins. GBTC began trading in 2013 and became redeemable on January 11th.

“Grayscale believes that investors will gradually switch away from ETF products with annual management fees of 1.5% (taking into account taxes) rather than opting for other reputable companies with fees as much as 80% lower. Parent company Digital Currency Group (DCG) and Grayscale itself have been in a lot of negative news recently.Then, a product that was once trading at a 50% discount to net asset value has been discounted by 2.0%. According to 10x Research, GBTC holders (whose market capitalization is $27 billion) were being charged excessive fees.

“Investors will sell first before moving their BTC exposure to other ETF issuers. This will cause downward pressure on Bitcoin and leave an overhang,” 10x Research added.

｜Translation: CoinDesk JAPAN
｜Edited by: Toshihiko Inoue
｜Image: TradingView/CoinDesk
｜Original text: Bitcoin’s Technicals Suggests Deeper Pullback to $38K: Analyst