Bitcoin Price Retreats After Ethereum ETF Approval Buzz

Bitcoin (BTC) price dropped 2.59% on Thursday (May 23rd) to close at $67,953. This decline comes despite a surge in excitement surrounding the US SEC’s approval of the first US spot Ethereum ETF (exchange-traded fund).

Key Factors Influencing Bitcoin Price

• US Labor Market and Services PMI: Data releases on these metrics dampened investor enthusiasm for riskier assets, including Bitcoin, by impacting expectations of a September rate cut by the Federal Reserve (Fed).
• Ethereum ETF Approval: While the SEC approved the VanEck Ethereum ETF, it hasn’t been greenlit for trading yet. This approval has likely drawn investor attention away from Bitcoin in the short term.
• US Bitcoin Spot ETF Market Flow: Despite the overall market decline, data suggests the US Bitcoin spot ETF market likely saw net inflows on Thursday. This indicates continued institutional interest in Bitcoin.

Friday’s Market Watch

• FOMC Member Commentary: Statements from FOMC (Federal Open Market Committee) members will be closely monitored for their impact on investor sentiment regarding a potential September Fed rate cut.
• US Core Durable Goods Orders and Michigan Consumer Survey: These economic data points could influence investor risk appetite and potentially affect Bitcoin price.
• ARK 21Shares Ethereum ETF Deadline: The final decision on this ETF is expected on May 24, potentially sparking further interest in Ethereum.

BTC/USD Technical Analysis:

Bitcoin remains above the 50-day and 200-day EMAs (exponential moving averages), indicating a bullish long-term trend. Breaking above the $69,000 resistance level could propel Bitcoin towards the all-time high of $73,808.

A drop below the $65,000 support level could lead to a further descent towards the 50-day EMA at $64,000. Bitcoin’s 14-Day RSI (Relative Strength Index) reading of 56.74 suggests there’s room for further gains before entering overbought territory.

Overall Market Volatility

The entire cryptocurrency market experienced significant swings on Thursday as traders anticipated the SEC’s decision on Ethereum ETFs. This volatility resulted in over $350 million in liquidations across leveraged crypto derivative positions, highlighting the market’s sensitivity to major regulatory developments.

ABOUT THE AUTHOR See More

Arslan Butt

Index & Commodity Analyst

Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.

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