According to Reuters, the Russian central bank wants to ban investments in cryptocurrencies in the country. Following the bearish news, Bitcoin’s price fell to near $48.5k in the spot market. In the options market the last 48 hours, many options traders sold Calls and bought Puts to hedge for the near-term expiries.
Multi expiry skew shows that traders seek downside protection. It seems that they are not optimistic about the rally in 2021:
On a daily timeframe, according to the Bollinger Bands indicator, the short-term trend still seems to be to the downside, the lower band slope is more than the previous corrections, and the baseline has built a resistance at $50.5k. The price seems to be entering a long-term erosive correction phase, and most likely, it will make retail investors disappointed and frustrating.
On the 1-hour timeframe, the price is going down and forming a falling wedge (a technical pattern that is usually bullish), creating a lower low and lower high. One can expect the price to rise to this wedge, but if it passes, the resistance of $50K on the way of Bitcoin to form a higher high.
Probably the most bullish point is from an onchian analyst perspective. At the moment is a divergence between the price action and the All Exchange Reserves trend.
Unlike the market crash in May, the monthly net position change shows a significant volume of BTC being taken off the market the recent drop from $69K to $42K. The Conclusion is that the supply shock is evident but the supply/demand puzzle would be completed when the new capital flows into the market by new investors.
Binance Free $100 (Exclusive): Use this link to register and receive $100 free and 10% off fees on Binance Futures first month (terms).
PrimeXBT Special Offer: Use this link to register & enter POTATO50 code to get 50% free bonus on any deposit up to $1750.
Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.
Cryptocurrency charts by TradingView.
Credit: Source link