From the first minutes of the day, the official X account of the United States Securities and Exchange Commission (SEC) surprisingly announced the approval of all Bitcoin (BTC) spot exchange-traded funds (ETFs). The cryptocurrency market reacted quickly to the announcement, and the price of Bitcoin rose to $48,000. However, the excitement dissipated when it was understood that the approval announcement was fake and the SEC‘s X account had been hacked. SEC Chairman Gary Gensler confirmed the hack of the institution’s X account and clarified that no spot ETFs had been approved yet; the approval announcement was later removed. Consequently, the price of Bitcoin retracted to $45,500. QCP Capital commented on the incident, suggesting that the market might have already priced in the approval of spot ETFs for Bitcoin.
QCP Capital Analysts Issue a “Pricing” Warning for Bitcoin
Analysts from Singapore-based cryptocurrency trading firm QCP Capital assessed the situation. They noted that the initial reaction to the ‘approval’ was tepid, which could potentially indicate that the market had already anticipated this historic development. The analysts advised caution, hinting that the expected ETF approval might not trigger a significant rally.
Following the fake approval news, Bitcoin struggled to overcome resistance levels, while attention shifted to Ethereum (ETH), which remained relatively stable in the background. The ETH/BTC trading pair responded to the fake ETF approval announcement with a significant divergence, briefly dipping below its lowest level seen on June 22, 2023, but quickly recovered, surpassing the critical threshold of 0.051.
QCP Capital’s analysts also noted that investors are closely monitoring the ongoing high spot-futures basis spread, which presents an opportunity to sell the spread for a risk-free annual return of 12-17% if held until expiration. Furthermore, they highlighted that the option volatility, which had increased in anticipation of the ETF, was expected to normalize after the approval and provide new strategic opportunities.
Key Technical Levels for Bitcoin
Additionally, QCP Capital’s analysts shared important technical levels for Bitcoin. According to the analysts, the $40,000 to $42,000 levels are important support levels for BTC, with the first significant resistance level at $48,500. They pointed out that the January 26, 2024, expiration put option at $38,000, offering an attractive annual premium of 23%, presents a significant opportunity, supported by the reversal of risks and puts being more expensive than calls. QCP Capital’s analysts consider the $38,000 level an important buying point for investors looking to open long positions in anticipation of the block reward halving in April.
