Overview
The strong rebound in Bitcoin and other cryptocurrencies indicates that the market is still bullish, with investors seeing every drop as a chance to buy. Bitcoin reached a new peak above $69,200 before experiencing significant selling pressure, causing the price to drop below $60,000. This surrender led to over $1+ billion in cross-crypto liquidations.
Nevertheless, the decline did not discourage investors from purchasing the spot Bitcoin exchange-traded funds.
There was a significant increase in the amount of money flowing into Bitcoin ETFs, with BlackRock’s iShares Bitcoin Trust (IBIT) ETF experiencing its largest inflow of over $780+ million. There is a strong interest in Bitcoin, and if this continues, any pullbacks are expected to be minimal.
Fundamental Updates
Let’s delve into the significant developments shaping the crypto market landscape:
Fidelity Canada recommends 1-3% Portfolio Crypto Allocation: Fidelity, one of the largest asset managers worldwide, has 38+ million retail accounts and $12.5+ trillion assets under management, according to its 2023 annual report. It has been expanding its product line to include digital assets.
The firm states that its all-in-one products achieve a comprehensive portfolio in a single ETF. The fact that Fidelity’s all-in-one conservative fund allocates 1% to bitcoin suggests that the asset manager considers it less hazardous for individual investors. The counsellor recommends 3% for Growth and Equity. This is another step towards integrating cryptocurrencies into banking processes.
Eleven businesses received SEC approval to offer a BTC ETF in January, including Fidelity. $5.3 billion is managed by BTC ETF. Crypto adoption has been higher in Canada than the U.S. Country approved its first BTC ETFs in 2021, approximately three years before the SEC permitted comparable products in the U.S.
Bitcoin’s Sharp Drop From $69K Resets Crypto Funding Rates: Bitcoin’s (BTC) overnight fall from record highs has reduced market leverage, normalising crypto perpetual futures funding rates.
The top cryptocurrency slid 10% to $59,700 after reaching a lifetime high of $69,000. The slump pushed digital asset exchanges to close $1 billion in leveraged perpetual futures bets. Since then, annualised financing rates or the cost of holding leveraged bets in perpetual futures connected to the top 25 cryptocurrencies have dropped to less than 20% from triple-digit values a few days ago.
The hot perpetual futures market has cooled, allowing a longer rise to record highs. Funding rates rose above 100% early this week as investors jumped in with leveraged products to maximise gains on bitcoin’s bullish momentum.
Key Data Points
- Total market capitalization: The total market capitalization of the crypto market is currently around $2.64 trillion. This is a net $210 Billion change from last week.
- Bitcoin dominance: Bitcoin dominance, which tracks the percentage of the total market capitalization that is held by Bitcoin, is currently at around 49.80%. This is 1.38% down from last week.
- ETH dominance: ETH dominance, which tracks the percentage of the total market capitalization that is held by Ethereum, is currently at around 17.2%. This is 1.14% down from last week.
Bitcoin Price Analysis
Bitcoin has been experiencing a significant upward trend for a few days now. Traders see the declines as a chance to buy during an upward trend, which is what occurred recently. The buyers eagerly bought the dip to $59,200, showing strong interest at lower price points. Buyers are attempting to continue the upward trend by pushing the price above $69,000. If their efforts pay off, the BTC/USDT pair may initiate the next phase of the upward trend towards $70,000 and then $75,000.
The bears are running out of time. They need to protect the $69,500 level and push the price below $60,000 to initiate a correction in the short term. The duo could then experience a significant sell-off and drop to the $52,000 level.
BTC Technical Indicator
Macro Updates
- The labour market in the US is displaying a somewhat weakening yet remarkably robust pattern, as ADP rose by 140k in February and private payrolls have been consistently adding an average of 200k jobs per month since 2023.
- There was a decrease of -26k job openings in January, however, layoff rates continue to stay low at 1%.
- Despite the low layoff rates of 1%, the jobs-to-unemployed ratio is still around 1.4x, indicating a healthy but possibly underwhelming NFP report expected this Friday.
- The biggest trade union in Japan is set to reveal the outcomes of its yearly wage discussions on March 15, a development that could impact the decision on interest rates by the BOJ.
- In China, the National People’s Congress is underway, and the government work report has disclosed a growth target of around 5%, which has disappointed market expectations.
