BTC in Limbo as SEC Drags Out Spot BTC ETF Reviews

Key Insights:

• On Saturday, BTC saw green for the second consecutive day, gaining 0.23% to end the day at $29,494.
• Investors remain deadlocked on whether the SEC will approve one, some, or all the Spot BTC ETF applications.
• However, the near-term technical indicators remained bearish, signaling a return to sub-$28,500.

On Saturday, bitcoin (BTC) gained 0.23%. Following a 0.34% rise on Friday, BTC ended the day at $29,494. Significantly, BTC came up short of $30,000 for the fifth consecutive session.

Bitcoin (BTC) Price Action

This morning, BTC was down 0.15% to $29,451. A range-bound but bearish start to the day saw BTC fall from an early high of $29,495 to a low of $29,443.

Daily Chart

The Daily Chart showed BTC/USD sitting below the $30,750 – $31,250 resistance band. BTC also remained below the 50-day EMA ($29,452) while holding above the 200-day EMA ($27,004), sending bearish near-term but bullish longer-term price signals. Notably, the 50-day EMA narrowed on the 200-day EMA, supporting further losses.

Looking at the 14-Daily RSI, the 45.04 reading signaled a bearish outlook. The RSI signals a BTC fall to sub-$28,500 to bring the $27,500 – $26,850 support band into view. However, a move through the 50-day EMA ($29,452) would give the bulls a run at $30,000 and the $30,750 – $31,250 resistance band.

4-Hourly Chart

Looking at the 4-Hourly Chart, BTC remains below the $30,750 – $31,250 resistance band and the 50-day ($29,574) and 200-day ($29,721) EMAs, signaling bearish price momentum.

Significantly, the 50-day EMA pulled further back from the 200-day EMA after the bearish cross, signaling a return to sub-$28,500. However, a BTC move through the 50-day ($29,574) and 200-day ($29,721) EMAs would support a run at the $30,750 – $31,250 resistance band.

The 14-4H RSI reading of 49.73 indicates a moderately bearish stance, with selling pressure outweighing buying pressure. Significantly, the RSI aligns with the 50-day EMA, signaling near-term bearish momentum and a return to sub-$28,500.

BTC Remains at the Mercy of the SEC and US Lawmakers

It was a quiet Saturday session, with no external market forces to influence after the US inflation numbers on Friday. The crypto news wires were also silent on ETFs and US lawmaker legislation to roll out a US crypto regulatory framework.

For investors awaiting the SEC decisions on the spot BTC ETF applications, the SEC v Ripple Court ruling could have a bearing on the outcome. This week, SEC Chair Gary Gensler reminded the markets of his view on the digital asset space, suggesting a longer wait for spot BTC ETFs.

The Day Ahead

There are no US economic indicators to influence, leaving SEC v Ripple chatter, ETF updates, and Binance and Coinbase (COIN)-related news to draw interest.

However, investors should also continue to monitor the crypto news wires for SEC activity and US lawmaker chatter. Progress toward delivering a regulatory framework for the US digital asset space should provide price support.

While the SEC does classify see BTC a security, the SEC continues to influence BTC. On Thursday, Grayscale sent a letter discussing the matter of the spot BTC ETF applications. Grayscale highlighted the approval of the Bitcoin Futures ETFs, saying,

“Having determined the CME bitcoin futures market meets the Commission’s stated criteria for a market of significant size in the context of bitcoin futures ETPs, the commission is logically bound to reach the same conclusion in the context of the Trust and other spot bitcoin ETPs.”

The letter went on to say,

“This is because, as the Commission noted in April 2022 when approving a Rule 19b-4 filing relating to a bitcoin futures ETP, CME’s surveillance can reasonably be relied upon to capture the effects on the CME bitcoin futures market caused by a person attempting to manipulate.”

The SEC disapproved a Grayscale spot BTC ETF application in June 2022, stating that the application did not address questions on preventing market manipulation, among others.

However, investors should continue to monitor the crypto news wires for SEC and US lawmaker chatter. Progress toward delivering a regulatory framework for the US digital asset space should provide price support.