beehiiv-import

⚡Bitcoin Suffers 3% Dip🔻

Croxroad

25 Oct 2023 — 4 min read

☕️ GM Dear Plebs!

Here is Crox Road, your daily dose of orange pill that will turn you into a Bitcoin Maxi.

The menu for today:

📉 Bitcoin Loses Ground

Bitcoin (BTC) took a sudden 3% nosedive, dropping from its position around $35,000 on a Tuesday morning, and the reason was the removal of BlackRock's (BLK) spot bitcoin ETF, known as IBTC, from the Depository Trust & Clearing Corporation's (DTCC) website. The appearance of the IBTC ticker on DTCC's site the previous day had set off a wave of speculation among investors. Many thought this could signal the imminent approval of a spot bitcoin ETF, which contributed to Bitcoin's recent rapid surge from the $30,000 range to over $35,000. It's a vivid example of how sensitive the market can be to news and developments, with even small hints having a significant impact on prices.

According to data from the Chicago Mercantile Exchange (CME), open interest in Bitcoin futures reached an all-time high of $3.4 billion on Monday, indicating a substantial uptick in interest from institutional investors. As of the latest update, Bitcoin was trading at $33,600, reflecting a noteworthy 8% increase in value over the past 24 hours. This surge in open interest and price rise suggests that institutional players are increasingly engaging with the market, further solidifying Bitcoin's position as an attractive asset for a broader range of investors.

🐂 Fear & Greed Index Hits Peak Levels

Bitcoin, with its current price at $34,158, is seeing market sentiment surge to levels reminiscent of its glory days when it hit $69,000 back in mid-November 2021, and it's all thanks to the Bitcoin Fear & Greed Index. The index now sits at 72 out of a possible 100, marking it as "greed" territory. This represents a significant jump from its "neutral" rating of 50 on October 18 and a six-point boost since October 24. This upswing in sentiment coincides with the excitement around the potential approval of BlackRock's spot Bitcoin ETF by the U.S. Securities and Exchange Commission. Notably, on October 24, Bitcoin enjoyed its most substantial single-day gain in over a year, with a 14% surge that briefly pushed its price above the $35,000 mark. It's a clear sign of the Bitcoin market's resilience and its response to positive news and developments.

The Bitcoin Fear & Greed Index derives its score by considering data from six significant market indicators, with each playing a specific role in determining daily market sentiment. These indicators include factors like volatility, market momentum, and trading volume (25% each), social media chatter (15%), survey results (15%), Bitcoin's dominance in the overall market (10%), and current trends (10%). It's noteworthy that the last time the index hit a score of 72 was on November 14, 2021, just four days after Bitcoin achieved its record-high price of $69,044 on November 10, 2021, as per data from CoinGecko. This historical context emphasises the significance of the current index level and its resemblance to the optimism of the market during Bitcoin's previous all-time high.

The repercussions of the Terra collapse set off a chain reaction of events that had a dampening effect on Bitcoin prices, leading to the unfortunate downfall of entities like hedge fund Three Arrows Capital and Bitcoin lender Voyager Digital, along with others. Amidst the recent enthusiasm surrounding spot ETFs, Bitcoin investment firm Galaxy Digital has made an optimistic prediction, suggesting that if a spot Bitcoin ETF receives regulatory approval, the price of Bitcoin could potentially surge by more than 74% in the first year following such an approval. This forecast underlines the potential for significant market shifts in response to key developments like ETF approvals in the Bitcoin space.

🧣 On-Neck Pattern

The "on neck" pattern is a technical chart pattern typically observed after a downtrend in the market. It involves two specific candlesticks: first, there's a relatively long bearish candle with a substantial real body, followed by a smaller bullish candle. The bullish candle typically starts with a gap down from the previous candle's opening price but manages to close near or at the prior candle's closing price. This pattern is referred to as the "on neck" pattern because the closing prices of the two candles are either identical or very close, forming a horizontal line that resembles a neckline on the chart. It's a pattern that traders and analysts use to make predictions about potential future price movements.