Bitcoin is facing heavy selling pressure this Thursday as its price fell another 1.5 percent.
The benchmark cryptocurrency touched an intraday low of $34,200 and hit a higher high after falling below the key $34,000 support level in the previous session.
Its fall appeared mainly due to profit-taking among traders and investors especially after the price crossed the $38-000-40,000 area on more than two occasions.
As CryptoQuant CEO Ki-Young Ju comments, spot inflows into cryptocurrency exchanges cooled this week, suggesting a longer downward correction ahead.
„$35,684 -> $34,054, and I expect more,“ Ju said. „BTC OG whales are strong when there are no spot inflows.“
Bitcoin whale ratio on all Exchanges.
Nonetheless, long-term bullish fundamentals abound this week, giving Bitcoin Trader ammunition to continue its upward run. So why might the cryptocurrency reach $40,000 again? Here are three reasons:
#1 Blackrock announcement
BlackRock, one of the world’s leading investment firms, filed documents with the U.S. Securities and Exchange Commission saying it plans to introduce cash-settled bitcoin futures for two of its funds: the BlackRock Global Allocation Fund and the BlackRock Strategic Income Opportunities Portfolio.
While the announcement is no guarantee that BlackRock will launch a Bitcoin-enabled futures investment service, it does underscore a drastic shift in the New York-based $7.4 trillion firm’s tone toward cryptocurrencies in general. In 2017, BlackRock CEO Larry Fink had called bitcoin an „index of money laundering.“
But their recent inclusion of Bitcoin in their SEC filings shows a different view of the cryptocurrency. It confirms the growth of cryptocurrency as a mainstream financial asset, on par with its top hedging rival, gold.
#2 Grayscale’s Bitcoin Accumulation.
Grayscale, the largest crypto investment firm in the world, bought an additional $600 million worth of bitcoin after pausing its accumulation wave for more than a week.
Data provided by ByBt.com shows that the New York-based firm added 16,244 BTC to its vault, bringing its total reserves to more than 630,000 BTC worth nearly $23 billion.
Grayscale Investment’s bitcoin holdings are on the rise.
Analysts see Grayscale’s wave of accumulation in the new year as a signal for another price rally.
„Grayscale has bought more than 8,000 bitcoin,“ explains Clark Davis, a crypto YouTuber, for example. „If they did that every day, they would buy 2.9 million BTC this year. There are only 2 million on exchanges. There’s no scenario where with this insane demand the price won’t go much higher.“
#3 Bullish Triangle
Bitcoin (Go to Buy Bitcoin Guide) is also looking bullish on the technical front. The cryptocurrency is now forming a bullish symmetrical triangle as it consolidates within it since its first major correction from nearly $42,000.
Bitcoin is targeting a breakout after consolidating within the symmetrical triangle pattern.
Ideally, the BTC/USD exchange rate should break out in the direction of its previous trend, which is bullish. That would technically move the pair’s upside target up to $14,289 – the maximum level of the triangle.
That would take the bitcoin price to at least $50,000.