- Matrixport predicts a 7% Bitcoin price drop in the next 2 weeks based on a change to bearish trading signals, the first since August 2022.
- This follows Matrixport’s previous skepticism that the SEC would approve spot Bitcoin ETFs in January, which drew criticism when Bitcoin rapidly declined afterward.
- Bitcoin surpassing $45k for the first time since April 2022 was partly fueled by anticipation of SEC spot ETF approval, so the decision is eagerly awaited.
Crypto research firm Matrixport has issued a warning that Bitcoin’s price could drop by 7% in the next two weeks. The company’s analysts cite a change in trading signals that has turned bearish for the first time since August 2022. This prediction follows Matrixport’s previous skepticism about SEC approval of spot Bitcoin ETFs in January.
Matrixport’s Analysis and Price Prediction
In a January 8th blog post, Singapore-based Matrixport said it expects a potential decline in Bitcoin’s price, indicating the current breakout attempt may not hold. The firm expressed concerns about the consensus that the SEC would approve spot BTC ETFs by January 10th.
Matrixport suggested “smart money” could profit from the anticipated approval by selling Bitcoin. Although leverage has been flushed out recently, the firm sees limited downside risk, with the $36,000-38,000 range potentially being retested.
Matrixport noted Bitcoin’s funding rate on exchanges dropped sharply from 6.61% to 0.74% in January. This could make BTC technically vulnerable, as the earlier unsustainable funding rate spike may reverse.
Previous Skepticism Over Spot Bitcoin ETF Approval
Matrixport’s latest warning follows a previous report where its analysts doubted SEC Chair Gary Gensler would approve spot Bitcoin ETFs. They believe Gensler’s comments signal a preference for stricter crypto compliance over endorsing a spot BTC ETF as an alternative store of value.
Galaxy Digital’s Head of Research Alex Thorn criticized Matrixport’s earlier report as “bewildering and nonsensical.” Bitcoin rapidly declined to $41,500 afterward. Will Clemente and others attributed the selloff to Matrixport, underscoring the market’s sensitivity to news and rumors.
Matrixport co-founder Jihan Wu later clarified the firm doesn’t influence analyst reports, saying the reaction was unexpected.
Meanwhile, anticipation of SEC approval for spot Bitcoin ETFs has contributed to BTC’s recent price growth. Surpassing $45,000 in early January was Bitcoin’s first time above $45k since April 2022.
Conclusion
Matrixport predicts Bitcoin’s price could drop 7% in the next two weeks based on a change in trading signals. This bearish outlook follows the firm’s skepticism about SEC approval of spot BTC ETFs in January, which drew criticism. The crypto community eagerly awaits the SEC’s decision, as potential ETF approval has fueled Bitcoin’s price gains so far in 2023.
