Bitcoin is dancing with critical support since its rejection north of $48,000 on Saturday. This crypto is the first by market capital and has traded at $45,937, with 1.5% losses over the last day.
TA: Bitcoin is Struggling, But It’s Too Early to Say Bulls Have Given Up| TA: Bitcoin is Struggling, But It’s Too Early to Say Bulls Have Given Up
It seems any attempt from the bulls to take back control it’s faded due to aggressive selling pressure. Bitcoin could be negatively reacting to a more hawkish U.S. Federal Reserve, and fresh uncertainty in the legacy market as COVID-19’s Omicron variant spreads.
Jerome Powell, the head of a financial institution, has hinted at a tapering early in his tenure. Lightcrypto, an anonymous analyst says this. causedLarge investors decided to remove risk and sell their holdings when BTC went for $60,000.
These institutional operators amended their strategies to preserve their end-of the-year profits. They were also warned not to re-enter market conditions in this current environment. Light, similar to other analysts, believes Bitcoin has been seeing “programmatic selling behavior”.
OTC flows this week were all caused by people quitting their positions. This is the end of an era for many corps and funds.
That is all I know about the market.
In the past, we have seen holiday price movements with Q1 setting a new trend.
— IamNomad (@IamNomad) December 17, 2021
NewsBTC reports that the downtrend has had an impact on the derivatives industry, resulting in a 25 percent decrease in the Open Interest (OI). It has made the price action stronger due to lower participation by retail investors who are attracted more to other cryptos than Bitcoin. According to the analyst:
While bulls are cautious, bears take to aggression. They push perpetuals basis negatively on some venues and build OI. Meanwhile, large players that derisked in excess of $60k have reversed the course and started to absorb panic and short-selling.
How China is losing its ability to influence the Bitcoin price
Positively, Light’s programmatic selling behavior could be ending in the short term which would open the doors for the following rally. Material Indicators’ analysts posted data via Twitter that indicated a historic ending to the behavior as of December 20, 2013.ThUp to 25Th.
Signs of planned selling are evident in Binance We witnessed accelerated selling during the mid-month in most of this year’s (legend). It stops around the 20th – 25th of every month, also generally marking the bottoms on PA. Not following this pattern, marked tops for the given month.#BTC pic.twitter.com/lH4YMM0Ps3
— Material Scientist (@Mtrl_Scientist) December 19, 2021
This relief from selling pressure usually leads to the market experiencing a Santa Rally. The Santa Rally is characterized by an increase in Bitcoin prices and other cryptocurrency prices after Christmas eve. Light said that the phenomena could surprise the market and that big players might be able to profit from the bullish trend’s next phase.
The funds are probably done with the structural sell flow, have cashed up, and are now ready to consider frontrunning in the opposite direction, which is incoming buy flows for January.
The decrease in OI and leverage positions, the fact Bitcoin has seen a 35% dropped from its all-time high into a historically bullish season, and the fact big players now have the cash to take new positions, support Light’s bullish thesis. The analyst believes the bears will be “stoneless soon enough”.
| MicroStrategy Thinking About Lending Bitcoin to Generate Yield WHY?
In addition, Light pointed out that two major crypto exchanges, Huobi and OKEx, will remove the “majority of mainland users”. The positive implications of this announcement could prove to be bullish for Bitcoin, as Asia trading sessions in the past have led to negative price movement in 2021.