Market update: Bitcoin holds the high ground, as Binance deals with client exodus

Bitcoin hovers near $38k but struggles for sustained breakthrough. A recent CoinShares report suggests its stability relates to increased institutional investment.

The market witnesses a notable surge, marking the 9th consecutive week of positive inflows. Anticipation of the spot Bitcoin ETF and next year's halving event likely fuels this demand. Bitcoin records $312 million inflows last week, contributing to a yearly total of $1.5 billion. This suggests growing investor confidence.

Over the last 18 months, there's been a significant shift, with Hodlers increasing exponentially, further underlining positive sentiment in the cryptocurrency landscape.

Crypto coins chart

Binance faces client exodus following Zhao’s exit

Binance grapples with the aftermath of CEO Changpeng Zhao's exit, causing turbulence in the crypto exchange sphere. Despite a Q4 crypto renaissance, the exchange faces uncertainties.

Concerns arise over Binance's sustainability following $4.3 billion fines, leading to approximately $1 billion outflows post-Zhao's departure. Continued outflows pose a substantial risk, warranting close monitoring.

The BNB token encounters challenges, dropping 8% after Zhao's announcement. The removal of zero-fee crypto trading has also eroded Binance's market share. While not facing the same charges as FTX, industry watchers ponder if Binance is on the brink of a decline.

BNB daily chart

Risk events ahead

There remains some risk from a USD perspective this week, which could impact the US dollar and thus Bitcoin. We witnessed a bit of that today with Fed policymakers' comments received as a tad dovish - which has seen the US dollar selloff gain further traction.

Market participants appeared buoyed by comments from Fed policymaker, Waller in particular who stated that: “If inflation consistently declines, there is no reason to insist that rates remain really high.” If market continue to perceive Fed comments and US data in a dovish light this week, and the US dollar selloff continues, this could help Bitcoin achieve a clean break above the $38k mark.

US economic calendar

Bitcoin technical analysis

From a technical standpoint, BTCUSD is interesting as it hovers just below the $38k mark. Nothing much has changed from a technical standpoint done previously. The 38,000 mark remains a stumbling block to further upside, and I fear the longer we stall at this level, the greater the likelihood for a selloff becomes.

Resistance levels:

• 38000
• 40000
• 42500

Support levels:

• 36200
• 35500-35200
• 34177

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