Bitcoin restarts after option open positions dilute

Bitcoin’s trajectory starting in 2022 is different from the trajectory expected by most traders. After trading sideways for most of the fourth quarter of last year, the first cryptocurrency by market capitalization seemed to suggest greater volatility in either direction.

Related Reading | With the outflow of 20,000 BTC from the exchange, Bitcoin once again surpassed $51,000

As of press time, Bitcoin’s trading price is $46,803, which has been trading sideways in the past 24 hours. The price of BTC returned to its current level after being rejected near $50,000 at the end of 2021.

BTC is trading sideways on the 4-hour chart. source: BTCSUD transaction view

Data from Material Indicators shows strong support below the current price of Bitcoin, as the bidding order for 10 million USD is about 45,000 USD, and the other 36 million USD is allocated between 44,000 USD, 43,000 USD and 42,000 USD. If it falls further, these levels may become the last line of defense for the bulls.

Above the current price of Bitcoin, there is no obvious resistance before $59,000, where an asking order of $13 million is recorded. This does not mean that BTC will move directly in this direction, because buyers still need to show conviction and maintain the above support level.

The BTC price (blue line) and its support level (yellow below the price) are in the low time frame.Source: Material Index

According to data from Arcane Research, the Bitcoin market in the derivatives industry has reset to $5.8 1 billion BTC options expiring on December 31This is one of the biggest expiration events, causing the industry’s open interest (OI) to drop by 47.8%. Arcane Research claims the following:

This (decline in OI) may be accidental, but it may also be caused by the market structure of option expiration and futures expiration (…)

The research firm also claimed that most options away from currency bullish strikes are “worthless” at the end of 2021. The options market has been an important part of the BTC price trend in the past two years. If history repeats itself, it may hint at the next development of cryptocurrency in the first quarter of 2022. Arcane Research stated:

The options market may help anchor BTC prices. In January, February, March, April, October, and November, the first half of Bitcoin’s earnings were strong, and the second half was negative.

New year, new market dynamics for Bitcoin?Cost of adoption

Despite the following support, Bitcoin may try to fill the evil with the $42,000 printed on December 3.Justin Bennet claim Before resuming its bullish momentum, BTC has historically fallen into a similar downward trend.

Source: Justin Bennett via Twitter

Bennet believes that the price movement of BTC can no longer be classified as a bull market and a bear market.Instead, analysts believe there is more The “gray area” created by the participation of new participants and institutions.

Related Reading | The market feels comfortable with Bitcoin being trapped?Why BTC is preparing for a short squeeze

John Bollinger, the creator of the Bollinger Bands indicator, seems to have a similar stance on the potential changes experienced by the BTC market.Via Twitter, Bollinger Say:

Some thoughts on Bitcoin. You have to be careful about what you want: everyone wants to be widely adopted, listing futures, options, ETFs, etc. Well, you got all of this, including emerging regulation. The problem is that these things have completely changed the nature of transactions.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *