Bitcoin (BTC) price continues to trade with a bullish bias but remains shy of the $38,000 psychological level amid waning hype for the spot BTF exchange-traded fund (ETF) after the the US SEC missed the eight-day window to approve exchange-traded funds (ETFs.
The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its inception, a total of 19,445,656 BTCs have been mined, which is the circulating supply of Bitcoin. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.
Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value. For Bitcoin, the market capitalization at the beginning of August 2023 is above $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the Bitcoin price around $29,600.
Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.
Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.
Bitcoin (BTC) remains a hot topic on social media site X despite the US Securities & Exchange Commission (SEC) missing its eight-day window to approve spot BTC exchange-traded funds (ETFs). Instead, a new narrative for the delays has arrived, pointing to the financial regulator’s preference that the ETFs do cash creates rather than crypto and is reportedly engaging with exchanges.
Cash creates makes sense IMO bc broker dealers can’t deal in bitcoin so doing cash creates puts onus on issuers to transact in bitcoin and keeps broker dealers from having to use unregistered subsidiaries or third party firms to deal w the btc. Less limitations for them overall
— Eric Balchunas (@EricBalchunas) November 17, 2023
Nevertheless, the ETF narrative remains an interesting topic after Cathie Wood’s Ark Invest and 21Shares amended their spot Bitcoin ETF application. It comes after revelations that the financial regulator had been engaging with exchanges.
Bitcoin price is holding thinly above critical support at $36,788 after a foray into the supply zone extending from $36,276 to $37,301. For a continued uptrend, the price must decisively move above this level and clear the $37,972 resistance level.
Until then, the upside potential for Bitcoin price remains under threat, with the Relative Strength Index (RSI) flattened out. The Awesome Oscillator (AO) is also supporting the gloomy outlook, with its histogram bars taking on a red feel and edging toward the midline. If this goes on, the AO could soon flip negative.
Increased selling pressure could see Bitcoin price flip below the $36,788 support level and potentially fall below the ascending trendline to test the $35,410 support level. In a dire case, the slump could extend to the $34,000 psychological level, while BTC collects the buy-side liquidity (BSL on the chart) residing underneath.
However, to confirm a prolonged downtrend Bitcoin price must break and close below the $30,824 midline of the supply zone (now serving as a bullish breaker) extending from $30,126 to $31,524. If this level fails to hold as support, BTC could slide all the way to $29,753.
BTC/USDT 1-day chart
On the flipside, increased buying pressure could see Bitcoin price clear the $37,972 local top to test the $37,972 range high. In a highly bullish case, the gains could extend for BTC to test the $40,000 psychological level, almost 10% above the current price.