Bitcoin Closes Record Week Until BTC ETF Launch – 5 Things To Watch For This Week

An exciting new week begins with Bitcoin’s return to challenging all-time highs and the possible launch of the first Bitcoin Exchange Traded Funds (ETFs) in the US.

Bitcoin bulls were not put down last week as the surge below $ 60,000 took just an hour and bears were driven away again.

After a rather quiet weekend, there was a typical drop in prices on Sunday before a sharp rise just an hour later.

As a result, Bitcoin not only maintained its bullish course, but closed its highest week ever – around $ 61,000.

As the market prepares to trade the first US Bitcoin ETFs, volatility is inevitable, but the bulls are holding up, according to analysts.

Here are 5 things to consider as Bitcoin is heading for an all-time high (ATH) and institutional access to BTC is taking a historic leap.

Bitcoin only allows the purchase of Dip for 1 hour

When the price seemed to hit ATH, it hit an obstacle and Bitcoin surprised everyone again within a few hours.

After losing $ 60,000 late Sunday, the bulls are not giving BTC time to weaken. Before the price even hit $ 59,000, they embarked on a massive buying frenzy.

Hours later, the crypto king is not only over $ 60,000 but also over $ 62,000 and still over $ 61,000 at the time of writing.

The event doesn’t even affect Bitcoin’s weekly close (around $ 61,500), although volatility remains at its highest level.

“The historic weekly close means that BTC is in a good position to continue rising,” wrote the trader and analyst Rekt Capital. summary on Monday.

He added that the next phase of BTC price action will be “more volatile” than before, in line with bull market years like 2013 and 2017.

BTC price 4-hour chart | The source: Trade view

While many analysts celebrate the memorable end of the week, the opening of the US market can also cause excitement.

Tomorrow the first Bitcoin ETF approved by US regulators will hit the market. Note that this is imminent as BTC is only $ 3,000 away from ATH.

Refinancing rates on the stock exchanges have also cooled on the futures market since last week. Accordingly, those who worry that unsustainable price increases could lead to the height of the recession can also breathe a sigh of relief.

Bitcoin Funding Rate Chart | Source: Bybt

ETF approved, but not for everyone

Love it or hate it, admittedly this week is the time for a Bitcoin ETF.

When rumors circulated last weekend that the US authorities were giving the green light to a Bitcoin ETF, bitcoin price action heated up and the trend is likely to continue this week.

After years of rejection, the Securities and Exchange Commission (SEC) has finally approved two ETF products, both based on CME Group’s Bitcoin futures.

Next month, the SEC will also decide on a physical Bitcoin ETF after an extended grace period and is also a topic of interest to analysts. Bitcoin is the base value for this product.

There is no guarantee that these traditional ETFs will be approved and there have been many fears that the market will disappoint again.

Since many applications have been decided, however, there are still 6 months until the breakthrough from the SEC.

Bitcoin ETF Approval Process | Source: Arcane Research

The optimistic sentiment that the above trend will benefit the crypto industry continues this week as Grayscale confirms it will request the conversion of its flagship Bitcoin fund product into an ETF.

Grayscale’s fund, the Grayscale Bitcoin Trust (GBTC), has been a major player in trading at an ever-increasing discount to BTC’s spot price for the past few weeks amid concerns from institutional clients.

GBTC’s higher fees are a competitive advantage, while some note that a futures-based ETF, by definition, would not be a suitable alternative.

This table shows why you should buy better #Bitcoin Coal Bitcoin Futures ETF. For investors, new Bitcoin ETFs could be more expensive than buying cryptocurrency directly. Bitcoin Future has underperformed by 30 percentage points since Bitcoin Future was launched in 2017. https://t.co/1ZnVBJQlGa pic.twitter.com/oXrZ95Wsmg

– Holger Zschaepitz (@Schuldensuehner) October 17, 2021

“This graph shows why you should buy bitcoin versus a bitcoin futures ETF. For investors, a new Bitcoin ETF can be more expensive than buying the cryptocurrency directly. Futures have underperformed by 30 percentage points since the beginning of 2017. “

Cryptocurrency trading company QCP Capital said on Friday:

“Most institutional players have direct access to CME futures. Often the main reason for trading ETFs versus futures is to avoid tracking errors (versus spot prices) that result from futures costs or offsets. Therefore, an ETF based on CME futures takes the fundamental advantage of an ETF of tracking spot prices as closely as possible. “

Difficulty increased for the 7th time in a row

Bitcoin network fundamentals continue to impress this week. It is best known that the difficulty increased for the 7th time in a row on Tuesday, the last time in 2019.

That increase would bring the difficulty back over 20 trillion for the first time since June.

Bitcoin 7-day diagram for the average level of difficulty | Source: Blockchain.com

This happened despite some fluctuations in the hashrate, with estimate has now dropped to 120 exahashes per second (EH / s) after climbing over 140 EH / s this month.

However, with the general uptrend still intact, few have raised concerns as the US currently holds the largest share of Bitcoin mining power.

Supply shock predicts an optimistic 2022

While Bitcoin price predictions are currently focused on what could happen in the fourth quarter of this year, some people take a longer look and draw even more optimistic conclusions from the data. Like Willy Woo, who created the Woobull data resource and is known for his Bitcoin market cycle studies.

At the weekend it was Woo emphasize The growing scarcity of Bitcoin is likely to fuel continued price pressure.

Historically, he noted, the reduced supply combined with more supply in the hands of the hodler with no sales plans creates a strong bullish signal.

Its “Long-Term Hodler Supply Shock” indicator clearly shows that such a scenario has happened many times in the history of Bitcoin.

“Technical name for this diagram: 2022 will be a good year.”

Supply shock for long-term owners | The source: Willy Woo

Long-term owners reportedly control a near-record-breaking percentage of BTC supply, leading to predictions that the battle for the remaining coins will be hotter than ever.

This is compounded when a physical ETF is approved, which will happen as early as November and could last for several months.

Meanwhile, the BTC balances on the major exchanges that CryptoQuant tracks are now close to 2.4 million BTC after a sharp drop in September.

The next bitcoin bear market is coming

While there is a lot of excitement about where Bitcoin price could peak this year and how high it is, some analysts have turned their attention to the other side – the bear market.

Historically, no asset has risen in a straight line and Bitcoin is no exception. In each halving cycle, there was a price high in the year after the block reward was halved, followed by a price low in the middle of the cycle.

Several prominent market players claim this cycle will be no different.

Hence, there will be a sustained decline after the peak, similar to 2014 and 2018.

For prominent analyst TechDev, the high should be higher than the low ($ 60,000) anyway, but the process will begin before the end of 2021.

I want an extended cycle. Who would not do that?

But nothing I’ve seen regarding macro PA suggests it will happen.

Watch your indicators.

2 week RSI channel, RVI 92-93.

If they get hit, I’ll be out.

Ignore them in hopes of a new paradigm and you will likely be dumped by those who don’t. pic.twitter.com/Znj7yMdyLt

– TechDev (@ TechDev_52) October 17, 2021

“I want a long cycle. Macro analysis shows that it will happen. Look at your indicators. 2 week RSI channel, RVI 92-93. If so, i’m going. Ignore them in hopes of a new model and you could potentially lose money if you don’t. “

Among the accompanying charts, one clearly shows the high of the relative strength index in the 2-week period, which corresponds to the BTC price high.

Source: TechDev

Rekt Capital also used this opportunity to recall about when to reduce losses.

“People think that BTC will never see a -80% bear market again because it is now a mainstream and such a mature asset class. Don’t forget that there was a -53% correction a few months ago. The average bear market is -84.5% low. It will most likely happen after this bull market. “

However, the weekend offered an upbeat forecast with Dan Morehead, Managing Director of Pantera Capital, claiming that the bottom of the bear market will “flatten”.

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