Three Factors Behind Bitcoin’s Inability to Conquer $28,000

Bitcoin (BTC) has failed to seal the $28,000 resistance level owing to macroeconomic concerns, dampened trading metrics, and dashed expectations for a Bitcoin spot ETF.

Bitcoin has faced increased selling pressure. With the price now at $27,677.18, atop a 0.55% slump, Bitcoin is battling some key elements that have dampened investor optimism.

Macroeconomic Conditions

As an investment asset, trends in the global economy have an underlying impact on shaping the price performance of Bitcoin.

Recently, Michael Barr, the U.S. The Federal Reserve Vice Chair for Supervision expressed optimism on economic growth. He noted that rising interest rates can significantly constrain economic activity.

These economic constraints have varying ramifications in the crypto ecosystem as a whole. Policies that will be made to support a vibrant economy might fuel the attractiveness of traditional assets, thus dampening hopes in Bitcoin’s immediate future.

Reduced Interest

Besides, the Bitcoin futures premium has continued to trade below the healthy neutral benchmark of 5%. Typically, the Bitcoin Futures Premium defines the readiness of futures traders to delay settlement on their contracts. This metric is expected to be between 5% and 10% annually.

That Bitcoin is trading below this benchmark shows limited demand for long positions. This downturn and the slowdown in spot trading volumes have contributed to the underperformance of Bitcoin this month.

Bitcoin ETF Hopes Dashed

Besides the sentiments surrounding the forthcoming Bitcoin Halving event, the expectations of a BTC spot ETF product remain a crucial growth determinant for the coin.

With Ethereum Futures ETFs that launched earlier this week recording very poor trading volumes, investors are now very skeptical about the future of Bitcoin spot ETFs. Although the U.S. Securities and Exchange Commission has yet to approve any of such products, the sentiment around it is low.

Despite these discouraging metrics and the resistance at $28,500, BTC has continued to hold above $27,000. The last time the asset saw below the $27,000 psychological support was on Oct. 1. Bitcoin has successfully defended the threshold as it looks to recapture $28,000 further.

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