bitcoin's potential for a significant price move is under scrutiny as Jon Najarian, an experienced options trader, shares his thoughts on the market. He specifically examined the potential impact of a spot bitcoin ETF.
He believes that the introduction of such an ETF could trigger a substantial rise in major cryptocurrencies, estimating a notable 25% to 30% rise in a short two-day period.
According to Najarian, who also contributes to CNBC, investors appear to be preemptively positioning themselves to capitalize on the expected positive market reaction once the ETF is established.
Will bitcoin fall to $37,000?
Examining the technical aspect, Najarian suggests a likely retracement scenario, indicating a return to the $37,000 level. He is referring to historical chart patterns where this specific price served as a major barrier to bullish movement.
In light of this historical resistance, Najarian speculates that, in the event of a pullback, $37,000 could serve as a key support level, offering a potential cushion against downward market pressures.
Najarian's insights reflect a combination of fundamental expectations regarding the impact of a btc ETF and technical analysis considerations, providing a comprehensive perspective on potential market movements.
btc market cap currently at $838 billion. Chart: TradingView.com
Traders and investors can find value in considering both aspects as they navigate the dynamic landscape of the cryptocurrency market.
According to the analyst, there is a potential catalyst that could propel the alpha coin into a sudden parabolic rise. In a recent interview with trader Scott Melker, Najarian expressed his belief that the US Securities and Exchange Commission is likely to give the green light to spot ETFs.
Optimistic about ETF approval
From Najarian's perspective, such regulatory approval would act as a powerful trigger, catapulting the leading cryptocurrency to an impressive gain of up to 30% in a span of just two days.
He said:
“I think we are going to get a spot bitcoin ETF. When we do, bitcoin will move between 25% and 30% in two days (…) I think we will go back down and test $37,000 again.”
bitcoin supporters, such as Samson Mow, CEO of Jan3, have predicted that in the “days or weeks” following the US government's approval of a bitcoin spot ETF, the price of bitcoin would increase to 1 million dollars.
The cryptocurrency industry is eagerly anticipating the US government's eventual approval of a spot ETF, but some analysts warn this could have unintended implications for cryptocurrency exchanges.
Bloomberg ETF forecasters Eric Balchunas and ETF Store head Nate Geraci say centralized bitcoin exchanges have a bleak future.
A blood what?
On December 17, Geraci posted on X, a platform that was once Twitter, describing a potential bitcoin spot ETF as a “bloodbath” for bitcoin exchanges if it were allowed.
It will be a bloodbath for crypto exchanges…
– Nate Geraci (@NateGeraci) December 18, 2023
For example, analysts at JPMorgan Chase stated in September that they anticipate the SEC will approve several spot bitcoin exchange-traded funds (ETFs) simultaneously. However, the investment bank issued a warning that spot bitcoin ETFs could severely put downward pressure on the price of bitcoin.
Thirteen bitcoin spot ETF applications are still pending before the SEC. Gary Gensler, chairman of the securities regulator, announced last week that the organization is re-examining these files.
As the digital asset landscape changes, the idea of a subsequent drop to the $37,000 level serves as a warning of how unpredictable the market is. Cryptocurrency fans and investors should consider these potential outcomes with a balanced view, taking into account both the short-term possibilities and the long-term strength of the cryptocurrency.
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