Last week a “Christmas rally” caused a bullish looking bitcoin (BTC) course. Then the market turned out again overleveraged and the BTC rate makes another strong correction this week. Last Monday, bitcoin was rejected at $52,000 and now the price has even plunged below $47,000, a loss of 10%. As a result, the fear in the market is on the rise again.
Bitcoin Fear and Greed Index is 22. Extreme Fear
Current price: $46,496 pic.twitter.com/1EETA6EedX— Bitcoin Fear and Greed Index (@BitcoinFear) December 30, 2021
Where is the bottom of the bitcoin price?
From bitcoin price could yesterday morning didn’t hold on to the $48,000 and it dipped briefly below $47,000 early yesterday afternoon and then even touched $46,650 cryptocurrency-exchanges as Binance.
There, bitcoin first made a significant bounce and recovered to $48,000. During the evening, however, bitcoin lost traction again and gradually fell back to $47,000. Shortly after midnight, bitcoin began to fall sharply again. The price then even touched $46,000, the lowest since December 20.
Once again, the market is speculating whether bitcoin has finally tested a bottom and can rise again. The price is slowly starting to look a bit more bullish and recovered to $47,000 overnight, but it doesn’t look very stable yet.
A week and a half ago, bitcoin even dipped a bit below $46,000 and that opportunity now exists. It is even possible that bitcoin will fall through this support this time and then the price could even make a dive to the area between $40,000 and $42,000. According to Whalemap, bitcoin will no longer dip below $25,000, but the market is not hoping that the price will fall that far anyway.
How would it make you feel if you knew #BTC will not fall below $25k? pic.twitter.com/kOOxaw4yH4
— whalemap (@whale_map) December 29, 2021
More volatility rise?
This correction is accompanied by low trading volume as well as options traders who are currently massive put take positions on option contracts. Options are derivatives with which you buy, as it were, the right to buy or sell a certain asset or crypto for a certain price in the future. A call option gives the right to buy an asset at a predetermined price and date. A put option is the same, but gives the right to sell. Bulls usually bet on call options and bears on put options. As many as 125,000 $6 billion option contracts will end tomorrow, potentially adding to volatility.
1) Santa rally fading, BTC Dec31 46k Puts bought, anecdotal rumblings of Tradfi LP allocation audits into EOY, making for a captivating finale as Dec31 Options roll and completely detach into Jan bullishness: Jan7 50-53k Call spread, Jan28 55k Calls + Jan 1×2 Call spreads bought. pic.twitter.com/n0zVf65DMw
— Deribit Insights (@DeribitInsights) December 29, 2021
#btc dec 31 $6bn expiry gamma estimate – short at 46+48k strike in size, as day closes in to just hours away deltas can go from 0 to 100 to 0 again real quick. at current price est. $7.25mn! perp to buy/sell per +/-$200 move in btc. moves should remain fluid both ways into nye pic.twitter.com/rohCjpvXsq
— bithedge (@bit_hedge) December 29, 2021
Then perhaps there is still a story to be played in the crypto world. It is speculated that some traders will now sell their BTC just as quickly so that they have to pay less tax on their crypto assets for 2021. They would then probably rejoin on 1 January. However, there is no data to confirm this trend. Furthermore, we see an increase in the net inflow of BTC to exchanges, a bearish sign.
#Bitcoin has been experiencing consistent inflows into centralized exchanges since December 25th.
A total of 18,472 $ BTC has been deposited into exchanges.
Positive netflows are usually considered bearish as users deposit their assets into the exchange to sell them. pic.twitter.com/5YnkGfMI77
— IntoTheBlock (@intotheblock) December 29, 2021
Yet the crypto analysts remain bitcoin for the first months of 2022 still very bullish.
Bears seem to be dominating the narrative at the moment
I’ll just leave this here…
1yr HODL wave currently going parabolic. Now showing that 57% of #Bitcoin has not moved on chain over the past year. Long-term HODL’ers unfazed by short-term noisehttps://t.co/I2BG2JM5AN pic.twitter.com/wypDGqdpka
— Philip Swift (@PositiveCrypto) December 29, 2021
#BTC Daily Chart.
– Currently #BTC is below 50W MA looks forming the same pattern when it was below 50W MA during the July dip.
– Also PNL supply loss/profit in % looks showing that #BTC is nearly at the bottom as same as the July dip.
– Bullish. https://t.co/vlm2WHIPcX pic.twitter.com/F4uioVMk0B
– Minkyu Woo (Min) 우민규 ⚡️???????? ???????? (@minkyutekken) December 30, 2021
DAILY REPORT: ZOOM OUT pic.twitter.com/fidYOBa1wQ
— Bobby Axelrod Bought The Dip (@Bobby_Axel_Rod) December 30, 2021
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