An illustration of Bitcoin's price eyeing $40K amid record hash rate as part of 5 things to know in Bitcoin this week. Invest in Web 3.0 now!
BTC price eyes $40K amid record hash rate — 5 things to know in Bitcoin this week

Bitcoin (BTC) begins a new week at its highest levels in 18 months, leaving traders wondering what comes next. The BTC price has held steady after reaching $38,000 last week, but since then, a testing “micro-range” has left bulls and bears in a stalemate. Market participants are now trying to determine whether a deeper retracement is coming or if the asset will break the $40,000 barrier.

The coming days will bring various potential catalysts that could cause Bitcoin to trend in a certain direction, while there are also signs that the market is due for a boost. Volatility is expected at the end of the month, but before then, a range of macroeconomic events could bring unexpected price action. Cointelegraph takes a look at these issues and more in its weekly review of Bitcoin price volatility triggers.

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Monthly close nears with BTC price rising less than 10%

The monthly close is a key date for day traders this week, with Bitcoin at a crossroads.

As Cointelegraph reported, untested liquidity levels on the downside and the potential of $40,000 to the upside — surrounded by resistance — make for a stubborn daily trading range.

Neither bulls nor bears have been able to dislodge an increasingly tight corridor for BTC/USD, and even new higher highs on daily timeframes have been few and fleeting.

At the latest weekly close, a timely drop saw bids beginning to be filled, with Bitcoin dropping to lows of $37,100 before recovering, data from Cointelegraph Markets Pro and TradingViewshows.

For popular trader Skew, it is now time for bid momentum to return.

“Spot takers led the bounce & eventually perp takers were the forced bid; mostly shorts forced out of the market,” he wrote in part of a dedicated analysis on X (formerly Twitter).

Skew also noted blocks of liquidity both above and below the spot price, with $37,000 and $38,000 as the key levels to watch.

“Lots of bid liquidity below $37K so if spot takers continue to be net sellers this would be the momentum required to fill those limit bids below,” he wrote about the order book on the largest global exchange, Binance.

With the monthly close just days away, Bitcoin is currently up 7.8% month-to-date, making November 2023 a fairly average month compared to years gone by.

Data from monitoring resource CoinGlass shows that November is normally characterized by much stronger BTC price moves, which can be both up and down.

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Key Fed inflation markers drive macro catalysts

As November winds down, Bitcoin traders are prepared for a classic macro week with volatility triggers to match.

The U.S. Federal Reserve will be receiving important data on inflation in the coming days, which will influence their decision on interest rate policy in December. Fed Chair Jerome Powell will be speaking on Dec. 1, preceded by comments from other senior Fed officials throughout the week.

The most significant data for markets will be the Q3 gross-domestic product and Personal Consumption Expenditures (PCE) for October, due on Nov. 29 and Nov. 30 respectively.

Previously, U.S. macro data showed inflation abating quicker than what markets anticipated, leading to positive revaluations of risk assets.

“Full trading week ahead and volatility is here to stay”, summarized The Kobeissi Letter on X.

Data from CME Group’s FedWatch Tool currently indicates a 99.5% chance of the Fed keeping rates at their current levels.

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GBTC eyes BTC price parity

Although Bitcoin is still waiting for U.S. regulatory approval for its first spot price exchange-traded fund (ETF), the sentiment is steadily changing for the better.

The Grayscale Bitcoin Trust (GBTC), the largest institutional investment vehicle for Bitcoin, is a clear example of this. GBTC is expected to be converted to a spot ETF and is quickly approaching parity with its underlying asset pair, BTC/USD.

The fund’s revival has become a significant narrative in the pending ETF approval and the emergence of institutional investors in Bitcoin.

“It looks like the market is really expecting this ETF approval soon,” said William Clemente, co-founder of crypto research firm Reflexivity, referring to the data over the weekend.

The most important dates to keep in mind are after the start of the new year. According to QCP Capital’s latest market update sent to Telegram channel subscribers, Jan. 3, 2024, could be the approval date for the first spot ETF, which would coincide with the 15th anniversary of the Bitcoin genesis block.

If ARK Invest’s application is rejected and the rest are postponed, the key deadline is March 15, 2024, when Blackrock and the main group of candidates face their final deadline.

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Bitcoin hash rate passes 500 exahash watershed

The upcoming block subsidy halving in April 2024 has led to Bitcoin miners deploying record processing power to the network, resulting in the hash rate reaching its highest levels ever and passing 500 exahashes per second this month.

This achievement is not only a psychological landmark but it also shows the miners’ confidence in future profitability despite the BTC price being 50% below its peak.

Data from on-chain analytics platform CryptoQuant also shows that outflows from known miner wallets to exchanges are at their lowest levels in seven years.

“The flow of movement from Bitcoin miner wallets to exchange wallets ultimately represents the activity of these entities in the open market,” wrote Caue Oliveira, a contributing analyst, in one of CryptoQuant’s Quicktake market updates.

Oliveira noted that miners are always selling some portion of their holdings, but the current 90 BTC monthly average is the lowest since 2017.

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Bitcoin exchange holdings resume downtrend

Following a month of disruption due to the suspension of withdrawals and legal action against some of the biggest crypto exchanges, BTC holdings are trending downwards once again.

In accordance with the overall trend that has been in place for five years, the stocks of BTC held by exchanges have been steadily decreasing.

According to the latest data from on-chain analytics firm Glassnode, the combined holdings of the major exchanges totaled 2.332 million BTC as of Nov. 26.

This is the lowest amount of BTC held by exchanges since April 2018, with the exception of a brief dip in October. At its peak in March 2020, shortly after the COVID-19 market crash, the total was 3.321 million BTC.

The situation in November was further complicated by traders’ reactions to Binance receiving a record $4.3 billion U.S. fine, as well as Poloniex and HTX suspending withdrawals completely following a hack.

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