Matrixport’s crypto research executive Markus Thielen faults parties who disregarded the viability of Ethereum following its 10% as BlackRock filed for spot Ethereum exchange-traded fund (ETF). The analyst termed the doubters as suffering a nuclear winter experience as the ETH price surged above 10% in the past 24 hours.
BlackRock Filing Trigger Parabolic Ethereum Surge
The analyst reflects on the sudden Ethereum rally as attributed to the news of Larry Fink-led BlackRock registering Ethereum Trust in Delaware. Also, the largest global asset management firm would hours later file for spot Ethereum ETF with Nasdaq. Further, the investment firm condemned the doubters as the price surged 10%, taking the second-ranked crypto by market capitalization to exchange above the $2100 level.
Thielen’s Friday, November 10 report on decentralized finance (DeFi) termed the Ethereum rally as a parabolic surge resulting in a massive short squeeze. The analyst termed the overnight activity resulting in the highest funding rate owing to total panic for shorts.
The crypto research analyst acknowledged that crypto hedge funds portraying market neutrality are profiting from the funding rates. Thielen opines that inflows realized by crypto hedge funds will skyrocket as the process tops the agenda for the allocators.
Trading company QCP Capital linked the overnight Ether’s outperformance over Bitcoin to the confirmation of the BlackRock filing. The trading firm report on Friday, November 10, projected a repeat of the playbook witnessed in mid-2023 when the asset management giant filed for the spot Bitcoin ETF.
Thielen observed that cryptocurrencies registered an unprecedented uptrend in trading volume in the past 24 hours that surpassed $100 billion, as per CoinGecko price data. Bitcoin (BTC) realized a $33 billion trading volume dwarfed by tether (USDT) $69 billion and Ether (ETH) $47 billion.
Ether garnered bullish steam to exchange hands above $2100, though the price retreated to trade at $2090. The second-ranked token rallied as Bitcoin plunged 4% from the all-time high in 2023 that neared $38000. Nonetheless, Bitcoin continues to exchange hands above the $36000 level.
Thielen illustrated on Monday that while Ether lagged behind Bitcoin activity recently, the ETH/BTC ratio showed that higher beta trades harbored potential to yield great returns. The analyst restated that the Ethereum ecosystem showed resurgent signs, given the revenues’ recovery. The trend was suggestive of a likely surge in Ether’s price.
The shift coincided with increased trading volume for Ether and a resurgent funding rate for perpetual futures in Bitcoin and Ethereum. The crypto research analysts attributed the increment as reflective of traders’ growing optimism.
CME Bitcoin Futures Open Interest was Outperforming Binance
A review of the market activity shows that Bitcoin futures open interest within the Chicago Mercantile Exchange (CME) outperformed Binance. It marked the first time it was overtaking Binance, thereby signaling the institution’s growing confidence regarding the crypto space.
QCP’s analysts observed that CME bitcoin futures open interest was outperforming Binance at a time when market observers expect a delay of spot ETF approval till January 2024.
QCP analysts acknowledged that the flurry of activity witnessed across the trading platforms arose from optimistic investors betting that the Gary Gensler-led Securities and Exchange Commission (SEC) will approve the spot Bitcoin ETFs. The investors are showing affinity for the spot ETFs owing to the fear of missing out on would-be high-value products.
QCP analysts observed that while the spot Bitcoin ETF would be delayed till the onset of January 2024, the narrative surrounding BlackRock filing for spot ether ETF would drive the demand spirits to sustain crypto prices towards an all-time high. Similarly, the cryptocurrencies’ uptrend is attributable to support derived from the macro developments that are fueling demand for risky assets.
Exercise Caution in Pursuit of Spot ETF Rally
QCP warned that investors should exercise caution, particularly with bitcoin activity portraying divergent movement within the crucial resistance levels. The movement contrasts the relative strength index (RSI) that yields a reliable signal towards stalled momentum.
Theilen delved into the community skeptical of SEC approving the dozen applications for the spot Bitcoin ETF. The Matrixport’s executive projects the probability as 86% just as the market pricing and applicants’ preparedness show looming approval.
Thielen lamented that the majority of the individuals hardly realize that the ETF approval would still be several weeks prior to actual trading. The window would likely feature buyers front-running the unveiling of the product, thereby resulting in an enormous squeeze. As such, Thielen reiterated that the approval of the BlackRock spot Bitcoin ETF could trigger a 48% price rally.
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