Bitcoin price action proves that today’s SEC decision will trigger sell-off

Rick Steves

“Many attributed the significant sell-off to be caused by the fake news, with BTC’s price dropping from almost $48,000 to below $45,000 before rebounding and stabilizing in the range between $45,000 and $46,000 overnight. However, a closer analysis of the price action reveals a different narrative.

Matteo Greco, Research Analyst at the publicly listed digital asset and fintech investment business Fineqia International (CSE:FNQ) shared his views on the recent compromise of the SEC’s X account, which falsely confirmed approval of all spot Bitcoin ETFs in the US.

In a surprising turn of events, Bitcoin’s recent price action, initially thought to be triggered by the SEC’s denial of approving the spot Bitcoin ETF, is now being reconsidered as a classic “sell the news” phenomenon, according to the insights shared by Matteo Greco.

Classic “sell the news event”

Greco’s analysis challenges the common narrative surrounding the market movement. Contrary to the belief that the price drop was solely due to the SEC’s rejection, Greco points out a detailed timeline of events. At 21.11 UTC, the SEC’s official account tweeted about the approval of all Bitcoin Spot ETF filings, causing an immediate spike in BTC’s price from $46,700 to $48,000 in just four minutes. However, this surge was short-lived as the price swiftly returned to $46,700.

The unexpected twist occurred at 21.26 UTC when Gary Gensler tweeted that the SEC’s account had been compromised, clarifying that the approval was not legitimate. Despite the subsequent chaos, the price stabilized in the range of $45,500 to $46,000, currently trading at approximately $45,700 at the time of writing.

Greco’s thorough analysis indicates that the market movement was a reaction to what was believed to be real news, resembling a classic “sell the news event.” This pattern, where traders buy in anticipation of a positive news event and then sell when the news is officially confirmed, is a well-known occurrence in the market.

Despite the confusion, the SEC’s deadline for approving or rejecting the BTC Spot ETFs filings remains scheduled for today. Analysts still hold optimistic expectations, anticipating a positive outcome. If approved, trading could potentially commence as early as tomorrow, Thursday, January 11.

As the crypto community awaits the SEC’s final decision, the recent market fluctuations serve as a reminder of the volatility inherent in the cryptocurrency space, where a single tweet can trigger significant price movements. Investors and traders continue to navigate this dynamic landscape with heightened anticipation for the regulatory developments shaping the future of Bitcoin and the broader crypto market.

Matteo Greco’s unadulterated take on Bitcoin’s price action

“Yesterday, at 21.11 UTC, the official X account of the SEC confirmed the approval of all Bitcoin (BTC) Spot ETFs filings. However, after 15 minutes, at 21.26 UTC, Gary Gensler tweeted from his account that the “@SECGov Twitter account was compromised, and an unauthorized tweet was posted”. Gensler clarified that the SEC had not approved the listing and trading of spot bitcoin exchange-traded funds (ETFs).

“XSafety, the official X account providing security updates, confirmed that “@SECGov was compromised, and a preliminary investigation revealed that the compromise was not due to any breach of X’s systems”. Instead, an unidentified individual gained control over a phone number associated with the “@SECGov account through a third party. It was also confirmed that the account did not have two-factor authentication enabled when it was compromised.

“Many attributed the significant sell-off to be caused by the fake news, with BTC’s price dropping from almost $48,000 to below $45,000 before rebounding and stabilizing in the range between $45,000 and $46,000 overnight.

“However, a closer analysis of the price action reveals a different narrative. At 21.11 UTC, when the SEC’s tweet about the approval was posted, the BTC price was around $46,700. The price immediately spiked, reaching $47,400 in one minute and reaching its highest point of about $48,000 only four minutes later at 22.15. At that level, BTC quickly dropped back to $46,700 in just one minute, the same price recorded five minutes before, in correspondence to the SEC’s announcement. From there, the price continued to dip, reaching a minimum of about $44,750 at 21.25 UTC, exactly one minute before Gary Gensler’s tweet. After the revelation of the fake news, BTC price stabilized in the range between $45,500 and $46,000. At the time of writing, BTC is trading at approximately $45,700.

“The price action analysis confirms that yesterday’s market movement was a reaction to what was believed to be real news, resulting in a classic “sell the news event.” This pattern is typical in the market, where participants buy in the days leading up to a news event and then sell when the news becomes officially public. Despite the chaos, the SEC’s deadline for approving or rejecting the BTC Spot ETFs filings remains scheduled for today, and analysts’ expectations still lean towards a positive outcome. Trading could potentially commence as early as tomorrow, on Thursday, January 11.”

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