Bitcoin Could Retract to $36K Before Uptrend Resumes, QCP Capital Says

The January launch of a bitcoin (BTC) spot exchange-traded fund (ETF) is expected to face subdued demand initially, which could lead to a ‘sell the news’ scenario, Singapore-based QCP Capital wrote in a recent note. This could result in short-term volatility for bitcoin, which will shift the focus towards ether (ETH).

“It is likely that the actual demand for the bitcoin spot ETF at the start will fall short of market expectations,” QCP wrote. “We expect topside resistance for bitcoin in the $45k-$48.5k region and a possible retracement to 36k levels before the uptrend resumes.”

Bitcoin is currently trading above $43,700 during Asia business hours, up 2% on-day.

QCP writes that ether is seen as a potential secondary investment option with an anticipated market shift from bitcoin, and speculative interest in a forthcoming ether spot ETF could drive ether prices higher, even before the ETF’s actual launch.

“Ether might also be an interesting laggard play here,” they wrote. “This kind of headline excitement could create some speculative uplift for ETH price whether it is warranted or not.”

CoinDesk reported that BlackRock (BLK), Nasdaq (NDAQ), and the Securities and Exchange Commission (SEC) held their second meeting in a month to discuss rule changes for listing the bitcoin ETF, with BlackRock modifying its proposal to include cash redemptions, aligning with SEC preferences.

Grayscale also recently had a second meeting with the SEC.

Bitcoin is up 17% in the last month, according to CoinDesk Indicies data, as anticipation builds around the ETF.