Bitfinex predicts Bitcoin trades close to $20,000 in ongoing cycle.
Bitcoin, the popular cryptocurrency, is not expected to drop below the $20,000 mark in the current market cycle, according to analysts at Bitfinex. This prediction is based on the fact that a group of long-term holders has been actively purchasing Bitcoin since February 2023 when it was trading above $24,000.
Currently, Bitcoin is trading around $70,600, and analysts emphasize the importance of the short-term holder realized price, which is currently at $55,834. This price level has served as a crucial support and resistance level throughout the current market cycle.
The analysts anticipate that if Bitcoin were to decline to $56,000, it would align with the maximum downturn from a new local high to the bottom, which would be a drop of approximately 23-24%.
Bitfinex also highlighted recent data from spot Bitcoin exchange-traded funds (ETFs), which showed net negative flows for the first time last week. Each trading day reported a net negative flow, and the total outflows amounted to over $2 billion, primarily from the Grayscale Bitcoin ETF. After considering inflows from other ETFs, the net outflow was $896 million.
Despite this shift to negative ETF flows, the analysts at Bitfinex do not view it as a significant concern. They attribute the outflows to investors moving their funds from the Grayscale Bitcoin ETF to other providers that offer lower management fees, which are more attractive to investors.
In conclusion, Bitcoin is expected to remain above the $20,000 mark in the current market cycle, and the recent negative ETF flows are not seen as a major issue.
