Bitcoin in ‘Danger Zone’ as Whales Are Active on Exchanges & 78k BTC Options Expire Today
After falling to nearly $16,300, Bitcoin managed to stabilize yesterday, going above the $17,500 level. But as we reported, the pain is not over for the cryptocurrency market.
Today, the market is back to struggling, and it’s to be seen if we finally get the 30% retracement to under $14,000. The expiry of whopping 78k BTC options with a notional value of $1.3 billion today could propel this.
— skew (@skewdotcom) November 27, 2020
As Hxro Labs points out, Bitcoin has tapped the key retest at $16,500, and it must hold the level or risk further downside to $13,500. It added,
“Resistance now at $17,900 as a bearish throwback level. The market will need to reclaim $18,000 to signal continuation.”
The fact that Bitcoin whales are back at depositing on cryptocurrency exchanges is another reason a further dump is expected in the short-run. Ki-Young Ju, CEO of CryptoQuant noted,
“All Exchanges Inflow Mean(144-block MA) hit 2 BTC. I think we're in a danger zone. The price is likely to go sideways or down when whales are active on exchanges.”
“Bitcoin may be a victim of its own success,” said Michael McCarthy, chief market strategist at CMC Markets in Sydney. “Traders suggested several large holders moved to lock in gains as the cryptocurrency reached for all-time highs.”
Altcoins had started to turn green, recovering their losses when BTC went under $16,750 today, and the entire market got affected. With funding picking up, perpetual contracts are trading at a premium to spot.
ETH, which is back around $500, has its key weekly resistance at $620 with “$550 now as the bearish throwback level to break to signal continuation for bulls.” Bulls need to hold $465 to keep it from the further downside.
Once we have a healthy retirement, the market will get back into action. Ryan Rabaglia, global head of trading at OSL brokerage in Hong Kong said,
“It’s also not unusual to see a short-term pullback following periods of significant, accelerated gains as traders look to take profits before resetting once volatility subsides,”
“Once the dust settles, we’re back to business as usual with all medium to long-term bullish indicators still in play.”