Bitcoin (BTC) rebounded from new lows on Dec. 30 as markets remained undecided on its year-end trajectory.
$46,000 may not mark floor
Prior to the opening of Wall St., the pair was still above the $47,000 mark, with traders however warning that the BTC price flurry was not yet over.
“Pretty boring markets lately. Just a Bitcoin burnout process,” summarized Michaël van de Poppe, Cointelegraph Contributor.
“We are retesting $46,000 as support, recovered, but we may need to bring liquidity below lows before we do some bullish runs again.”
That liquidity was between $44,000 and $45,000 for the day, with Bitcoin steadily reinstating its limited range by the $53,000 resistance and above earlier in the week.
In a low liquidity holiday scenario, the potential for sharp moves up or down remained.
“Along with a high possibility of leverage tightening, we also have a general decline in trading volume,” noted on-chain analyst Glassnode in the latest issue of its weekly newsletter, The Week Onchain.
“Quieter trading activity is typical towards the end of the year, however, on a 7-day average basis, futures market volumes declined by 16% year-to-date. Lower volume and rising open interest ( in a concentrated exchange) are a combination that may be conducive to at least one localized leverage squeeze in the coming weeks.”
That tightening, argued veteran trader Peter Brandt this week, is yet to come.
Not everything is smooth between traders
As the Cointelegraph reported, it was the macro markets that were making headlines after Christmas, with new, albeit dubious, all-time highs.
At the same time, institutional interest in Bitcoin appears comparatively low, characterized by the underperformance of the first exchange-traded fund (ETF) of US Bitcoin futures.
“Total open interest futures has almost doubled this year, increasing by $9.57 billion (97%) to a total of $18.87 billion. 5 billion in open interest, mostly led by Binance traders,” Glassnode notes however.
Binance’s BTC balance increased throughout December, potentially due to the migration of Chinese users from Huobi Global.
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