Two-way race – Bitcoin (BTC) hits a new low since losing $ 50,000 on December 28, 2021. This December 2021 closing level – certainly far from $ 100,000 – remains important, because it would partly determine the level of probability of a rapid rise or fall in the price of bitcoin.
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Bitcoin Under $ 46,000: Liquidity At Lows
Bitcoin drops to around $ 45,996 on Bitfinex today, December 30, 2021. The bulls still manage to take back the $ 46,000 and then the $ 47,000. Bitcoin is trading at $ 47,239 at the time of writing, and is currently recording a daily loss of 0.27%.
For trader Michaël van de Poppe, this drop just below $ 46,000 is a ” bottoming out process for Bitcoin “. A bottoming out would mean that bitcoin is going down to relatively low levels, with a view to a potential bullish rally:
“We are testing the $ 46K support again, bounced back, but we may need to take liquidity below the lows before we do some upside runs again”
This liquidity would therefore today be at levels below $ 46,000.
Bitcoin in the short term: rapid rise or fall?
Can we really expect a bullish recovery in the coming days, as investors buy troughs?
Glassnode mentions in its The Week OnChain newsletter of December 27, 2021, “ a possibility of tighter leverage “. The price of bitcoin could very well move rapidly upward or downward in the next few days. This tightening of the leverage would be due to a decrease in volume on the futures markets, and an increase in open interest.
“Calmer trading activity is typical of year-end, however, on an average 7-day basis, futures market volumes have been down 16% year-to-date. Thinner volume and an increase in open interest (in a concentrated exchange) is a combination that may be favorable to at least a localized tightening of leverage over the next few weeks. “
Is a rapid rise more likely than another bitcoin price collapse? Trader Rekt Capital shared a chart in his tweet today, indicating that on a monthly basis, bitcoin “has turned resistance from February, August and September into new support this month.”
This new support corresponds to the zone of $ 44,000 – $ 47,000, and a monthly close in December 2021 above $ 47,000 would confirm the flipping of this major resistance into support.
The year 2021 could therefore end with a bitcoin below $ 50,000. Investors disappointed to see bitcoin so far away from the six digits can always take comfort by reading Arcane Research’s encouraging outlook for cryptocurrencies in 2022.
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