Bitcoin (BTC) has continued its rise in recent weeks, reclaiming major highs. However, recent analysis suggests that the $57,000 level could be one of the most critical support points for the bull rally underway.
This view comes from a CryptoQuant analyst, Burak Kesmeci, who highlighted the role of Bitcoin Spot exchange-traded funds (ETFs) in defining market stance.
Bitcoin Resilience at $57,000 Level
Spot ETFs have emerged as an important instrument in the Bitcoin ecosystem, offering a regulated entry point for institutional investors. According to Kesmeci, the average cost of Bitcoin Spot ETFs has been a key support level throughout 2024, providing a foundation for the asset price stability.
This level is set at $57,000 and has held steady throughout the year, with only two significant exceptions. The $57,000 price level is significant due to its technical support and the psychological implications for investors in cash ETFs.
Could the average $BTC Is ETF Spot Cost (57K) the Most Crucial Support Level in the Bull Rally?
“The price #Bitcoin We managed to stay above this level throughout the year, with just two exceptions.” – By @burak_kesmeci
Full post https://t.co/troZDKwKNw pic.twitter.com/IWqNJ2L6Kg
-CryptoQuant.com (@cryptoquant_com) October 16, 2024
The price of Bitcoin has fallen below this support level twice in 2024. The first instance occurred in early August, driven by Japanese market turbulence, and the second in September due to a sharp price correction.
Despite these market shocks, spot ETF investors did not react with panic selling. Kesmeci wrote:
Bitcoin Spot ETF investors have proven, contrary to the expectations of many, that they are not weak hands.
Foundation Set for Positive Movement
According to the CryptoQuant analyst, these investors demonstrated resilience by holding on to their investments, even as unrealized losses mounted. Its ability to withstand market pressure contrasts with typical behavior in other speculative sectors, where sudden price drops often lead to mass sales.
This suggests that Spot ETF investors have become more comfortable with Bitcoin inherent volatilityrecognizing its long-term potential.
The analyst highlighted that small outflows during these turbulent periods were not significant enough to disrupt the broader market.
Even during Japan’s carry trade crisis, where many expected a stronger market correction, general sentiment among spot ETF investors remained calm.
In conclusion, Kesmeci noted:
As you can see in the chart above, the average cost of Bitcoin Spot ETFs has become perhaps the most crucial support level in the 2024 rally. With this long-term perspective, the contribution of spot ETFs to Bitcoin’s recovery has established a solid basis for potential future market developments.
Featured image created with DALL-E, TradingView chart