BTC Spot-ETF Inflows in Focus Ahead of BTC Halving Date

The BTC Fear & Greed Index returned to the Greed zone on Tuesday. Expectations of more substantial inflows set a positive BTC price outlook.

Key Insights:

• BTC gained 1.75% on Monday, ending the session at $42,523.
• Early inflows into BTC-spot ETFs and the upcoming BTC halving contributed to the gains.
• On Tuesday, BTC-spot ETF-related updates and US lawmaker chatter remain focal points.

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Bitcoin Changes Course as Halving Date Inches Closer

BTC gained 1.75% on Monday. Partially reversing a 2.80% loss from Sunday, BTC ended the day at $42,523. BTC avoided a loss for the second time in five sessions.
On Tuesday, the Bitcoin Fear & Greed Index climbed from 52 (Neutral) to 64 (Greed). The return to the Greed zone sends bullish price signals. The Index remains below the January peak of 76 (Extreme Greed), aligning with views BTC was overbought in the lead-up to the SEC approval of BTC-spot ETFs.

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BTC Fear and Greed Index 160124
There was no trading across the US BTC-spot ETF market on Monday. The US markets were closed for Martin Luther King Jr Day. However,
Nonetheless, investors responded to the recent BTC-spot ETF inflow numbers. iShares Bitcoin Trust (IBIT) and Fidelity Wise Origin Bitcoin Trust (FBTC) reported solid inflow numbers over the first two trading days. Investors also responded favorably to new BTC-spot ETF ad campaigns to draw new investor money.
An upward demand trend for BTC ahead of the Bitcoin Halving would send a positive BTC price outlook. BuyBitcoinWorldwide estimates the halving date to be April 17, 2024.
BitcoinHalvingClock 160124
MicroStrategy (MSTR) founder and Chairman Michael Saylor recently discussed his BTC investment strategy. Saylor offered a simple supply and demand outlook, highlighting the likely launch of BTC-spot ETFs and the implications of the halving event on supply.
The launch of the BTC-spot ETF market coinciding with the halving event could prove pivotal. BlackRock (BLK) CEO Larry Fink had his to say about BTC,

“It is an asset class that protects you. And unlike gold where we manufacture new gold, we’re almost at the ceiling of the amount of BTC that can be created.”

Bitcoin and BTC-spot ETFs were not the only topics of discussion on Monday.

ETH-Spot ETF Hopes Keep ETH on the Front Foot

BTC struck a Thursday, January 11 high of $49,023 before investors rotated out after the BTC-spot ETF approvals. Investor rotation into ETH was evident, with ETH striking a Friday, January 12 high of $2,714.
SEC Chair Gary Gensler attempted to pour cold water on the prospects of a crypto-spot ETF market, saying,

“Importantly, today’s Commission action is cabined to ETPs holding one non-security commodity, bitcoin. It should in no way signal the Commission’s willingness to approve listing standards for crypto asset securities.”

However, speculation about the launch of ETH-spot ETFs continues to fuel hopes of an evolution of a crypto-spot ETF market. Bloomberg Intelligence Analyst James Seyffart responded to an ETF FAQ post on X (formerly Twitter), saying,

“ Shout out to Fred here. This is a great FAQ. Aside from #5. I think the odds of an ETH etf approval are a bit higher than that answer makes it seem. But they’re significantly lower than where we were for BTC ETFs. Will dive into this in the next ~ week.”

#5 asked whether Larry Fink can just get an ETH ETF. The answer to the question was,

“No. Gensler has to OK it, which he won’t do unless ordered by a court. This process could take years potentially (appeals etc).”

Considering SEC Chair Gensler’s comments about approving crypto-spot ETFs, court rulings could be necessary. The SEC v Coinbase (COIN) could address the issue. On Wednesday, January 17, the court will hear oral arguments from Coinbase and the SEC on the Coinbase motion to dismiss (MTD). Coinbase argued the SEC lacks the statutory authority to regulate crypto exchanges.

Technical Analysis
Bitcoin Analysis

BTC held above the 50-day and 200-day EMAs, affirming bullish price signals.
A BTC breakout from the $42,968 resistance level would give the bulls a run at the $44,690 resistance level and $45,000 handle.
On Tuesday, BTC-spot ETF inflows/outflows and regulatory scrutiny will be the focal points.
However, a break below the 50-day EMA would support a fall toward the $39,861 support level.
The 14-Daily RSI reading, 46.66, indicates a BTC drop to the $39,861 support level before entering oversold territory.
BTCUSD 160124 Daily Chart

Ethereum Analysis

ETH remained well above the 50-day and 200-day EMAs, affirming bullish price signals.
An ETH move to the $2,600 handle would bring the $2,650 resistance level into play.
Investors will remain focused on ETH-spot ETF-related chatter.
However, a fall through the $2,457 support level would give the bears a run at the $2,300 support level.
The 14-period Daily RSI at 59.43 suggests an ETH move to the $2,650 resistance level before entering overbought territory.
ETHUSD 160124 Daily Chart