The Daily Breakdown examines the developments in the crypto market, as drama engulfs the spot Bitcoin ETF situation.
Wednesday’s TLDR
- The SEC’s X/Twitter account was compromised.
- A false tweet about Bitcoin ETFs approval stirs up drama.
- Hewlett Packard is reportedly looking to buy Juniper Networks.
What’s happening?
After US stocks closed for trading on Tuesday, drama quickly began to unfold.
A post on X/Twitter from the SEC said that it had approved the spot Bitcoin ETFs, a headline that quickly spread throughout the investment community.
The approval was earlier than many had expected, and Bitcoin initially spiked up to a new 52-week high near $47,900. But then Bitcoin prices reversed lower as news broke that the SEC’s X/Twitter account was hacked.
Drama aside, ETF analysts expect a decision soon. So keep an eye out for an update on this front.
The setup
There are essentially two main components in the SEC approval process.
First, the SEC would have to approve the 19b-4 filings — those are from the exchanges that plan to list the ETFs for trading.
Second, the SEC has to approve the S-1 forms from the firms that would issue the spot Bitcoin ETFs.
If the SEC were to approve both, then technically, the ETFs could begin trading as soon as the next business day. With a decision deadline looming, it helps to know the process.
While the short-term action can be bumpy around major events, remember that Bitcoin has been in a very bullish trend. It hit new 52-week highs yesterday, has rallied in 10 of the last 12 weeks, and is up more than 75% from its September low.
It has rallied hard into the ETF decision. Even if that decision is favorable, it could result in some profit-taking. And that’s OK – as long as the uptrend remains intact, the focus could soon shift to the halving event in April. The halving may be Bitcoin’s next potential catalyst.
The $40,000 to $42,000 zone has been key support lately. As long as Bitcoin holds above that zone, it’s hard to get too bearish.
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What Wall Street is watching
U: The company’s stock fell by 8% after it announced the elimination of 1,800 jobs — about 25% of its workforce — as part of a comprehensive restructuring plan. Despite the fall, shares are still boasting big gains over the last few months, up more than 60% from its low on November 10.
CRWD: Shares of the cybersecurity firm hit 52-week highs after Morgan Stanley upgraded its rating to overweight from equal weight. The upgrade was influenced by promising product cycles — including its new AI platform.
JNPR: Juniper Networks surged on reports by The Wall Street Journal of an impending acquisition by Hewlett Packard for approximately $13 billion. For its part, Hewlett Packard stock dropped 9% on Tuesday.
Disclaimer:
Please note that due to market volatility, some of the prices may have already been reached and scenarios played out.