Bitcoin falls below $59,000, wiping over $318 million off the markets

• U.S. spot Bitcoin ETFs saw outflows of $127.1 million on Tuesday.
• Nasdaq Registers with SEC to List and Trade Bitcoin Index Options.
• Chain data shows long liquidations and a higher percentage of shorts, signaling a continuation of the bearish trend.

Bitcoin (BTC) is slightly higher on Wednesday, after falling 7.5% earlier in the week, following the broad risk-off tone seen in the markets. Nasdaq has filed with the US Securities and Exchange Commission (SEC) for the listing and trading of Nasdaq Bitcoin Index (XBTX) Options, a positive development for BTC, but on-chain metrics project a negative outlook as evidenced by a higher percentage of short , while U.S. spot Bitcoin ETFs saw outflows on Tuesday.

Daily Market Reasons: Nasdaq Seeks SEC Approval to Launch Bitcoin Index Options

• Nasdaq (NDAQ) announced on Tuesday that it has filed with the US Securities and Exchange Commission (SEC) to list and trade Nasdaq Bitcoin Index Options (XBTX). Nasdaq, a global technology company specializing in foreign exchange and financial technology services, has partnered with CF Benchmarks, a leading provider of regulated cryptocurrency indices, to improve the integration of digital assets into traditional financial markets.

Nasdaq Bitcoin Index options are designed to help institutional and retail investors manage their positions and protect their investments in the cryptocurrency markets. Subject to regulatory approval, these options will track Bitcoin prices using the CME CF Bitcoin Real-Time Index (BRTI). The product enhances the maturity and liquidity of the market by offering European-style exercise and cash settlement.

• On Tuesday, Coinglass data on US spot Bitcoin ETFs shows an outflow of $127.1 million. It was the first day of exits after eight days of entries, the longest winning streak since mid-July. As a result, BTC fell by 5.4% on Tuesday, and if this trend continues, the price of Bitcoin could fall further, as the net flow data of ETFs is crucial for understanding market dynamics and investor sentiment. The combined Bitcoin reserves held by the 11 US spot Bitcoin ETFs amount to $46.73 billion.

Bitcoin Spot ETF net flow chart

• Mi Primer Bitcoin, a nonprofit Bitcoin educational organization founded in El Salvador, is at risk of running out of funds, according to a tweet by its founder, John Dennehy. El Salvador is the first country to adopt Bitcoin as legal tender, and the country’s government has gradually increased its Bitcoin holdings.

“We are in danger of running out of funding before we start some longer-term funding at the end of the year. If nothing changes, we will run out of money in September,” he said.

“We’ve worked tirelessly to cultivate funding sources that best allow us to remain truly independent and ensure long-term sustainability, but we need a bridge for a few months to get there,” Dennehy concluded.

• According to DL News, the arrest by French authorities of Telegram founder Pavel Durov last Saturday could have been bad news for the crypto community.

“For years, crypto founders, developers, investors, and all kinds of users have gathered on the platform and formed groups to communicate, collaborate, and help grow their businesses. Durov’s arrest suggests that European authorities are stepping up their efforts to hold software developers accountable for the activity that takes place on their platforms,” ​​DL said.

Durov’s arrest reportedly created FUD (Fear, Uncertainty, Doubt) among the crypto community, potentially contributing to the recent crypto market sell-off and Bitcoin price decline.

In addition, famous figures in the crypto space have expressed concern about Durov’s arrest. Among them are Paolo Ardoino, CEO of Tether, one of the largest companies in the cryptocurrency industry, and Tesla CEO Elon Musk, who POSTED hashtag #FreePavel on his social media platform X.

• Lookonchain data shows that on Tuesday, as the price of Bitcoin fell by more than 7%, 87,405 traders liquidated for $318.46 million. Among them, one whale liquidated for $12.67 million on a long ETH/BTC position, and another liquidated for $12.6 million on a long BTC USD position. If BTC continues to fall, more traders could be wiped out of the market.

• Coinglass’ long-short ratio on exchanges shows BTC’s long-short ratio at 52.18%. This ratio reflects bearish sentiment in the market as there is a higher percentage of shorts than longs. This suggests that more traders are anticipating the Bitcoin price to fall.

Bitcoin long-short ratio chart

Technical Analysis: BTC is ready for a downward leg

Bitcoin price bounced around the daily resistance level at $65,379 on Sunday, down 7.5% over the next two days. On Wednesday, it is recovering slightly by 1% to $60,071 at the time of writing.

If BTC continues to decline and close below the $58,783 level, it could further decline by 4.5% to retest the daily support at $56,002.

The Relative Strength Index (RSI) on the daily chart has dropped below its neutral level of 50, and the Awesome Oscillator (AO) is about to close below its neutral level of zero. When both indicators trade below their neutral levels, it suggests weak momentum and an impending bear trend.

BTC/USDT Daily Chart

However, if Bitcoin price finds support around $58,783 and closes above it, the bearish thesis will be invalidated and BTC could rise 11% to review its daily resistance level at $65,379.