StanChart warns of further downside for Bitcoin over the weekend akin to August 2024
StanChart warns of extra downside for Bitcoin over the weekend equal to August 2024 StanChart warns of extra downside for Bitcoin over the weekend equal to August 2024
Fashioned Chartered sees parallels to previous Bitcoin sell-offs amid unstable weekend projections.
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Fashioned Chartered warned that Bitcoin (BTC) may possibly well potentially roam extra to between $69,000 and $76,500 over the following two days, continuing its current bound of crimson weekends.
Per the lender’s head of digital asset analysis Geoffrey Kendrick, the downside risk is driven by endured ETF outflows and mounting hedge fund short situation.
ETF outflows and hedge fund shorts
Kendrick detailed rising considerations over the marketâs current weak point and lamented the absence of prolonged breaks loved by utterly different markets.
He acknowledged:
âIt is on the conclude of weeks care for this that digital asset contributors need the asset class closed for the weekend.”
He added that Bitcoinâs fall below $80,000 â once a key resistance stage following Trumpâs election victory â raises questions about how a long way the sell-off may possibly well trail.
Kendrickâs evaluation pointed to necessary ETF job as a harbinger of extra declines. He famend that Bitcoin ETF outflows nearly touched $1 billion on Feb. 25, which is a serious threshold. Despite the necessary outflows, Kendrick believes the sell rigidity may possibly well now not be over.
He also highlighted a rising disconnect between ETF positioning and hedge fund short publicity in line with CFTC recordsdata.
Kendrick observed that for the explanation that US election, ETF positions surged from $23.5 billion to a peak of $40.2 billion â now down to $37.0 billion â while hedge fund shorts climbed from $7.9 billion to $11.3 billion as of Feb. 18.
Kendrick famend:
âETF positions are up 71% since Nov. 5, but hedge fund shorts are up finest 43%. This implies there is serene loads (the bulk) of outright longs within the ETFs. To the stage these stem from underlying retail float I feel they remain at risk of alarm selling.”
Geopolitical and regulatory uncertainty
Kendrick revisited his earlier warning concerning downside risks, warning that Bitcoinâs key convexity risk stage of $90,000 had been breached.
He had acknowledged earlier within the week:
âWhile BTC trades reasonably wisely all around the digital asset advanced, it is now caught up within the broader risk-off sentiment.”
Kendrick added that lower US Treasury yields may possibly well offer long-term give a rob to at the same time as come-term sentiment remains bleak but cautioned in opposition to taking a learn about for the dip forward of a more decisive dip.
Taking a learn about forward to the weekend, Kendrick expressed skepticism that risk belongings would rally given looming geopolitical tensions and tariff implementations.
He acknowledged:
“Possibly swish to deem we now own got had the Trump tariff noise now… But are risk belongings in actuality going to rally into the weekend now we now own got had the adverse recordsdata? I doubt it.”
Recalling a equal interval in August 2024 â when alarm selling pushed Bitcoin below $50,000 after a like a flash 5.5% decline â he famend that one other fall of equal magnitude may possibly well glimpse Bitcoin proceed into the $69,000 to $76,500 vary.
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Assad Jafri
AJ, a passionate journalist since Yemen's 2011 Arab Spring, has honed his talents worldwide for over a decade. Specializing in monetary journalism, he now specializes in crypto reporting.
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Fashioned Chartered
Fashioned Chartered PLC is a British multinational bank, headquartered in London, specializing in particular person, company, and funding banking, to boot to treasury providers.
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