Bitcoin retreats from its all-time high as the ETF enthusiasm faded away, but some investors expect the pullbacks to remain limited for the rest of the year so let’s take a closer look at today’s Bitcoin price news and analysis.
Bitcoin’s price continued to drop on Friday and ended the week down about 2% compared to a 1.7% gain in ETH. Some traders that went long on BTC head of the launch of ProShares’ future-focused ETF that this week it seemed to be taking profits. Still, some investors are expecting a pullback to remain limited for the rest of the year and one company even mentioned that alternative cryptos like ETH could see a new upside compared to Bitcoin. The crypto trading firm QCP wrote that they are remaining optimistic but still cautious about downside risks and noted that leverage levels a high in the BTC futures market that precedes a pullback in price most of the time. QCP expects ETH to outperform BTC in the near term.
Valkyrie Investments’ BTC Strategy ETF went live on the Nasdaq under the ticker BTF and the ETF share price tracked BTC lower during the first day of trading, marking a 4% drop and closing at $24.30. Bitcoin retreats from its ATH but the amount of money locked in the CME-based futures contracts tripled this month with $1.5 billion entering the market after the ProShares Bitcoin strategy ETF that went live on Tuesday. However, BITO could be exposed to a bigger tracking error or the difference between Bitcoin’s performance with actual returns from the fund.
This is because the CME allows one entity to own a maximum of 2000 contracts in the front-month futures while capping the positions across different maturities at 5000 contracts while BITO seems to be close to hitting the limit in October expiry that could bring longer duration futures. Ether dropped below $4000 and similar to BTC, technical indicators show that ETH is the most overbought point which preceded a sharp price pullback ever since September. ETH’s pullback could be limited to the $3700 support level.
The ETH/BTC ratio stabilized in the past week which suggests that the traders are starting to rotate out of BTC and ETH with the ratio held support staying at 0.06 which could face short-term resistance around 0.07 and 0.08. Despite the ETF enthusiasm being low, it was second in Coinbase exchange trading volumes as it landed the second spot in terms of trading volume on Coinbase. Coinbase wrote:
“The ETH buy ratio has picked up, suggesting a bounce in ETH/BTC might be in the making.”
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