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Crypto News Today: BTC-Spot ETF Outflows, Coinbase, and ETH-Spot ETFs in Focus

By:
Bob Mason
Published: Jan 24, 2024, 03:52 GMT+00:00

This week, JPMorgan Chase downgraded Coinbase from Neutral to Underweight as BTC-spot ETF-related data disappoints crypto investors.

Crypto News Today

In this article:

Key Insights:

  • BTC gained 0.93% on Tuesday, ending the session at $39,940.
  • Spot-ETF-related updates sent BTC to sub-$39,000 before dip buyers returned.
  • On Wednesday, US lawmaker scrutiny, BTC-spot ETF-related updates, and SEC activity warrant investor attention.

Bitcoin Dips Below $39,000 for the First Time Since December 2

BTC gained 0.93% on Tuesday. Partially reversing a 4.89% slide from Monday, BTC ended the day at $39,940. Significantly, BTC broke below the $39,000 handle for the first time since December 2. BTC-spot ETF-related updates influenced buyer appetite for BTC.

BTC-Spot-ETF Outflows Sent BTC Below $39,000

On Monday, the BTC-spot ETF market experienced net outflows of $76 million. The numbers were initially worse. Bloomberg Intelligence ETF analyst James Seyffart shared the initial numbers on Tuesday, which showed net outflows of $348.1 million, excluding updated iShares Bitcoin Trust (IBIT) numbers.

However, IBIT recorded $272.1 million of inflows, limiting the damage. Grayscale Bitcoin Trust BTC (GBTC) registered its largest single-day outflow of $640.5 million.

BTC-spot ETFs see net outflows.
BTC Spot ETF Flows 240124

BTC-spot ETFs remain a focal point for investors. However, the ongoing SEC vs Coinbase case and ETH-spot ETF chatter warrant ongoing investor attention.

Ethereum (ETH) Extends Losing Streak to Four Sessions

On Tuesday, ETH declined by 3.03%. Following a 5.89% slide on Monday, ETH ended the session at $2,242. Significantly, ETH dropped below the $2,200 handle for the first time since January 8.

Falling expectations of an ETH-spot ETF market continued to impact buyer demand for ETH. On Tuesday, James Seyffart shared an interview with SEC Commissioner Hester Peirce. The SEC Commissioner spoke about the approval process for ETH-spot ETFs, saying,

“That’s not how we’re going to do our approvals. […]. We shouldn’t need a court to tell us that our approach is arbitrary and capricious in order for us to get it right.”

However, the risk remains that issuers may need to take legal action to progress ETH-spot ETF applications. Last week, the SEC delayed the decision on the Fidelity ETH-spot ETF.

JPMorgan Chase Downgrades Coinbase to Underweight

This week, JPMorgan Chase (JPM) downgraded Coinbase (COIN) from Neutral to Underweight. JPM left the target price unchanged at $80, citing the BTC-spot ETF market as a headwind.

The recent pullback in the crypto market raises the threat of lower trading volumes and associated fees. Coinbase declined by 3.14% on Tuesday. Reversing a 2.77% gain from Monday, Coinbase ended the session at $124.19.

Market euphoria about the imminent approval of BTC-spot ETFs and bullish sentiment across the crypto market sent Coinbase to a December 2023 high of $187.39 before the retreat.

Significantly, the downgrade followed the recent Banking Committee hearing on Capitol Hill. JPM CEO Jamie Dimon famously ended an anti-crypto tirade, saying,

“If I were the government, I would close it down.”

Coinbase shares drop on JPM downgrade.
COIN Daily Chart 240124

Technical Analysis

Bitcoin Analysis

BTC remained below the 50-day EMA while holding above the 200-day EMA. The EMAs sent bearish near-term but bullish longer-term price signals.

A BTC break above the morning high of $40,277 would support a move to the 50-day EMA. A breakout from the 50-day EMA would bring the $42,968 resistance level into play.

On Wednesday, investors must consider crypto-spot ETF-related news and US lawmaker scrutiny.

However, a break below the $39,861 support level would give the bears a run at the $37,986 support level.

The 14-Daily RSI reading, 37.57, indicates a BTC fall below the Tuesday low of $38,547 before entering oversold territory.

BTC Daily Chart sends bearish near-term price signals.
BTCUSD 240124 Daily Chart

Ethereum Analysis

ETH sat below the 50-day EMA while holding above the 200-day EMA, sending bearish near-term but bullish longer-term price signals.

An ETH break above the morning high of $2,255 would support a move to the $2,300 resistance level and 50-day EMA. A breakout from the 50-day EMA would give the bulls a run at the $2,457 resistance level.

Investors must track ETH-spot ETF-related chatter.

However, a drop below the $2,200 handle would bring the $2,143 support level into play.

The 14-period Daily RSI at 39.63 suggests an ETH fall to the $2,143 support level before entering oversold territory.

ETH Daily Chart sends bearish near-term price signals.
ETHUSD 240124 Daily Chart

About the Author

Bob Masonauthor

With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.

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