Crypto News Today: BTC Visits Sub-$42,000, with the Fear and Greed Index in Neutral

Key Insights:

• BTC declined by 2.80% on Sunday, ending the session at $41,793.
• The Bitcoin Fear & Greed Index falls from Greed to Neutral, reflecting investor sentiment.
• On Monday, the markets will focus on BTC-spot ETF data and US regulatory activity.

Bitcoin Continues Correction After BTC-Spot ETF Approvals

BTC declined by 2.80% on Sunday. Reversing a 0.21% gain from Saturday, BTC ended the day at $41,793. BTC ended the week down 5.14% despite striking a Thursday high of $49,023.

The Bitcoin Fear & Greed Index reflected a marked shift in investor sentiment after the BTC-spot ETF approvals.

On Monday, January 15, the Fear & Greed Index fell from 60 to 52. Significantly, the Fear & Greed Index dropped from the Greed zone into the Neutral zone. The Fear & Greed Index peaked at 76 (Extreme Greed) on Thursday before the retreat. Extreme Greed signals a possible market correction ahead.

The current pullback is likely because investors locked in profits after the SEC approved the BTC-spot ETFs. Following the Grayscale victory against the SEC on appeal, BTC rallied from a September 2023 low of $24,963 to a January 2024 high of $49,023.

Bloomberg Intelligence ETF analyst James Seyffart recently suggested reasons for the recent losses. Seyffart’s top two reasons were,

1. “How many people do you think bought BTC or GBTC as a short/medium-term ETF approval play and are getting out?

2. Sales out of GBTC are flooding market, and there’s a settlement gap before *SOME* of that finds it way into these other ETFs or other exposures.”

Issuers Ramp Up Advertising Campaigns to Draw Investor Interest

Despite the recent losses, BTC-spot ETF issuers have seen reasonable inflows. Notably, issuers have ramped up advertising campaigns to draw new investors into the BTC-spot ETF market.

James Seyffart shared new advertising campaigns from Blackrock (BLK), Fidelity, and VanEck.

Notably, BlackRock and Fidelity led the pack with total inflows after two days. VanEck trailed by a large margin. Based on data for Thursday and Friday, the iShares Bitcoin Trust (IBIT) attracted inflows of $497.7 million. The Fidelity Wise Origin Bitcoin Trust (FBTC) attracted inflows of $422.3 million, while the VanEck Bitcoin Trust (HODL) recorded inflows of $10.6 million.

Following the BTC return to sub-$42,000, Monday inflows could influence buyer demand for BTC.

Technical Analysis

Bitcoin Analysis

BTC sat above the 50-day and 200-day EMAs, sending bullish price signals.

A BTC break above the $42,968 resistance level would support a move to the $44,690 resistance level.

On Monday, BTC-spot ETF-inflow/outflow data and SEC activity will be the focal points.

However, a fall through the 50-day EMA would give the bears a run at the $39,861 support level.

The 14-Daily RSI reading, 45.36, suggests a BTC fall to the $39,861 support level before entering oversold territory.

Ethereum Analysis

ETH sat well above the 50-day and 200-day EMAs, sending bullish price signals.

An ETH return to the $2,600 handle would support a move to the $2,650 resistance level.

ETH-spot ETF-related chatter needs consideration.

However, a break below the $2,457 support level would bring the $2,300 support level into play.

The 14-period Daily RSI at 58.89 indicates an ETH return to the $2,650 resistance level before entering overbought territory.