BTCUSD is testing the 50-SMA

Bitcoin has breached below the psychologically important $40000 for the first time since the beginning of December 2023.

BTC bulls are now trying to hold on to 50-period SMA for immediate support as the ETF hype starts to dissipate.

The downturn comes amid the $76M in net outflows on the 7th day following the spot BTC ETF launch.

However, …

• The overall flow of funds into bitcoin ETFs has remained on the positive side at $1.1 billion during the past 7 days
   
• A big proportion of funds outflows was attributed to the FTX’ block sale of it’s Grayscale Bitcoin Trust shares as a part of ongoing restructuring proceeding

Despite the recent turbulence, it may be too early to judge the overall success of the ETFs' launch with some of the large investment firms predicting the BTC to reach well over $100 thousand in the long-term.

Afterall the markets have already started discussing the possibility for Altcoins, namely Ethereum, to be next line for ETFenisation.

From the technical perspective …

• 50-period SMA is set to provide an immediate resistance
   
• “Death cross” bearish pattern (drop of short-term SMA below a long-term SMA) may potentially form on the short-term horizon with 21-period SMA ($43168) moving below 50-period SMA ($42995)
   
• To the upside the psychologically important $40000 will be the prime target – resistance level for the BTC bulls to keep close to/overcome in the immediate future
   
• To the downside, a drag below the 100-period SMA (38880) may further propel the price down towards the $38000 and subsequently to $37000 round numbers
   
• RSI’s current position at 37.60 (>70 – overbought; <30 – oversold) may suggest a potential for a technical pullback