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Highlights
- Bitcoin price debuts above $45,000 for the first since the post-ETF sell-off in January.
- BTC to continue with the transition into a pre-halving rally phase in the coming weeks.
- Surge in Bitcoin ETF volume implies improving sentiment in the market.
Bitcoin price showed solid strength on Thursday, climbing to $45,000 after bouncing back from below $43,000. This positive trend coincides with the growing demand for Bitcoin ETFs, which have seen inflows for several days in a row.
According to SoSoValue, the total net inflow on Wednesday rose to $146, which offset Grayscale’s $80.78 net outflow.
According to SoSoValue, on February 7, the total net inflow of Bitcoin spot ETFs was US$146 million, which has been net inflows for nine consecutive days. The Grayscale ETF GBTC had a single-day net outflow of US$80.78 million, and the other nine ETFs except Grayscale had a total…
— Wu Blockchain (@WuBlockchain) February 8, 2024
Expert analysis attributes the uptick out of the range between $42,000 and $44,000 to an increase in ETF activities but more significantly to the upcoming Bitcoin halving.
Bitcoin Price Eyes $46,000 – Next Important Level
A 4.6% increase in the price of BTC reinforces signals the return of bulls, who fled to the sidelines post-ETF approval sell-off. Mixed sentiments characterized the market in the wake of the drop below $39,000. Some market participants believed Bitcoin price will extend the drop to $36,000 and even $34,000.
However, Rekt Capital, a trader and analyst reckons that the correction was healthy, likening it to previous pre-halving price behaviour. Historically, BTC tends to drop a few months before the halving but makes a substantial upside move as investors hype the actual event.
Rekt Capital argues that “this past Monday, Bitcoin began its last week in the “Pre-Halving Downside” phase.” From here, It is expected to transition into a “Pre-Halving Rally,” likely to blast BTC above $50,000.
This past Monday, Bitcoin began its last week in the "Pre-Halving Downside" phase (orange) before transitioning in to the "Pre-Halving Rally" phase (light blue)
Already, Bitcoin is trying to breakout into its "Pre-Halving Rally" phase
$BTC #Crypto #Bitcoin pic.twitter.com/rU4MXkS1Ub
— Rekt Capital (@rektcapital) February 7, 2024
An Exciting Time For Bitcoin
The transition period is often an exciting time for Bitcoin, but more so for investors. It is the time many use to accumulate more before the pre-halving rally.
“As the Halving event approaches, we witness the market dynamics gradually shifting,” Muhammad Azhar, another analyst backed Rekt Capital’s insight.”This critical milestone underscores the unique nature of Bitcoins supply and demand.”
Read also: Bitcoin Halving 2024: How Miners Will Influence BTC Price Future Trend
Now that resistance at $45,000 has been dealt with successfully, $46,000 becomes the next important level to watch. Upon reaching this area, FOMO could bolster the uptrend and clear the trajectory to $48,000 or BTC may succumb to more dips before moving up again. Altcoin Sherpa, although unsure of the ultimate midterm direction, is still bullish on Bitcoin.
$BTC: Next significant area up is $46k IMO.
Price chopped below that 43.5k level for nearly a month; I think that we at least see a move to 46k before any significant pullbacks.
Still unsure of where we go in the midterm but still v. high time frame bullish myself. #Bitcoin pic.twitter.com/ympinumY4C
— Altcoin Sherpa (@AltcoinSherpa) February 8, 2024
The four-hour chart reveals the formation of an inverse head and shoulders pattern leading to the current breakout. Traders who longed Bitcoin above the pattern’s neckline resistance coinciding with the 20-day Exponential Moving Average (EMA) (the line in blue on the chart) at $43,616 are in profit and could choose to ride the trend to $46,000 before selling.
Massive inflows back the short-term bullish case based on the Money Flow Index (MFI). This indicator monitors both inflow and outflow volume. A persistent rise and into the overbought region indicates that a bullish outcome is likely in the coming sessions, especially the 11.6% breakout target of the inverse H&S pattern to $48,640.
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