More volatility expected as Bitcoin market sentiment dives to its lowest in virtually seven months.
Bitcoin (BTC) delivered fresh volatility on January. 6 as rangebound behavior saw its initial shake-up in weeks.
Open interest remains high
Data from Cointelegraph Markets professional and TradingView showed BTC/USD dropping nightlong to hit $42,000 for the primary time since December.
Although not the upper side prison-breaking that several had needed, the move was however expected, Bitcoin primarily “filling” the space left when it shortly wicked to $41,800 early last month.
Those lows were the results of a liquidation cascade, and whereas long positions conjointly felt pain this point around, skepticism remained on whether or not the revisiting of $42,000 had been enough to place in an exceedingly base.
“Honestly stunned we didn’t see additional of a flush these days if this was aggressive longs designed up. may still resolve to the upper side,” analyst William Clemente wrote in a series of tweets regarding the action.
“All I know for sure is that this party is just getting started.”
Clemente was among those already career for a lot of volatile conditions this month and noted that the bulk of Bitcoin futures open interest (OI) remained.
As Cointelegraph reportable, OI had hit incomparable highs in BTC terms throughout the week. As ever, those zooming out found comfort and familiarity in Bitcoin worth action versus historical behavior.
Fibonacci levels analyzed by fellow analyst TechDev showed that Bitcoin was still a minimum of making an attempt to repeat patterns designed up from previous halving cycles.
“Comparisons to past cycles aside, price/indicator action and volume behavior counsel to Maine that 2021 was effectively a year of consolidation (similar to 2019-Q3 2020) which is likely to guide to a different market impulse before following major correction,” he added in his own set of posts because the market began to dip.
Market most fearful since July 2021
For the average retail investor, however, it looked as if there was little hope left — a minimum of on the day.
(William Suberg, Cointelegraph, 2022)