Bitcoin Traders Anticipate Breakout as ETF Decision Looms

BTC price is expected to experience a significant shift due to the upcoming spot Bitcoin ETF decision and incoming U.S. inflation data.


Bitcoin Traders Expect End to Rangebound Moves

Bitcoin's price performance has shown decreasing volatility over the weekend, leaving traders uncertain about its reaction to the upcoming approval or denial of the first spot Bitcoin ETF in the United States. Many expect a temporary price retracement as a result of a 'sell the news' phenomenon, while others see the potential for a knee-jerk upside that challenges key psychological levels. Despite the uncertainty, indicators suggest a breakout from the current narrow intraday range.

One of these indicators is the Bollinger Bands volatility indicator, which is currently narrowing on daily timeframes, indicating an impending range expansion. Meanwhile, the 'spot premium' on Bitcoin markets, a sign of caution among derivatives traders, remains active.

BTC/USD chart with Bollinger Bands data. Source: Matthew Hyland/X

Bitcoin ETF Overshadows Inbound U.S. CPI, PPI Data

While all eyes are on the Bitcoin ETF decision, there are other macroeconomic factors to consider, such as the upcoming release of U.S. inflation data, including the Consumer Price Index and Producer Price Index for December. These data releases have historically caused short-term volatility for cryptocurrencies and other risk assets. The data is expected to show a continued decrease in inflation. However, it is unlikely to lead to a significant shift in the Federal Reserve's interest rate policy at its next meeting.

It is important to note that this article does not provide investment advice or recommendations. Readers should conduct their own research and analysis before making any investment decisions.

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