The cryptocurrency markets are buzzing with the possibility that one or more spot Bitcoin exchangetraded fund (ETF) applications will be approved by the United States Securities and Exchange Commission (SEC) by January 10. Bloomberg senior ETF analyst Eric Balchunas gives a 95% probability of the ETF approval by the regulator. Balchunas is not the only one showing confidence. Former SEC chair Jay Clayton said in an interview with CNBC on January 8 that the “approval is inevitable.

There’s nothing left to decide.” Although the ETF approval is a momentous occasion for the crypto markets, what will be the impact on Bitcoin’s price? Analysts are divided on the short-term reaction because some expect the uptrend to continue, but others anticipate the approvals to result in profit-booking by traders in a classic case of buy the rumor and sell the news. However, most believe that its long-term impact will be hugely bullish for Bitcoin.

Bitcoin is trading inside an ascending channel pattern. The bulls reasserted their supremacy with a sharp up-move above the $45,925 resistance on January 8. This propelled the price to the resistance line of the channel, which is likely to act as a minor hurdle. The upsloping moving averages indicate advantage to buyers, but the negative divergence on the relative strength index (RSI) cautions that the bullish momentum may be weakening.

However, if the price rises above the channel, it will indicate that the bulls remain in control. The BTC/USD pair could rally to the psychological level of $50,000 and then to $52,000. Sellers are likely to mount a strong defense at this level, but the uptrend could extend to $60,000 if bulls prevail.

Contrary to this assumption, if the price turns down from the current level, it will suggest that bears remain active at higher levels. The pair may drop to the 20- day exponential moving average (EMA), an important level to watch out for. If the price rebounds off the 20-day EMA, it will indicate that the sentiment remains bullish and traders are buying on dips. That will increase the likelihood of a rally above the channel.

If bears want to prevent the upside, they will have to drag the pair below the 20-day EMA. That may open the doors for a fall to the support line of the channel.

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