Bitcoin Price Is In A Tricky Situation, But The Network Has Never Been This Busy

The market is in the mix again.

Bitcoin has slid down under $11,300 after a strong performance at the beginning of the week. In tandem with BTC, altcoins also went down with Ether back at $370.

The market was eagerly awaiting the Chinese President’s speech Wednesday, on Shenzhen's 40th anniversary.

Binance CEO Changpeng Zhao excited the community with his “We will likely have two of the world's most powerful presidents pump crypto for us in 2 consecutive days” tweet.

Besides US President Donald Trump calling for the “go big or go home” stimulus, the rumor was Xi Jinping would be making a blockchain-related announcement.

However, Jinping disappointed traders with no mention of blockchain but did talk about aiming to lead the global technological revolution and make innovation the primary driver of economic growth.

The crypto market, however, is not the only one to record losses. S&P 500 has also been incurring losses, down 1.7% since the start of the week as some of the biggest U.S. banks began reporting earnings this week.

Gold has been fluctuating as well, going back below $1,900, recording over 2% losses this week, in contrast with the US Dollar index, which strengthened to 93.66.

Investors meanwhile continue to watch closely for any signs of more economic stimulus coming before the Nov. 3 election.

This is why bitcoin is not looking bullish as trader Loomdart noted, “the reason I expect painful chop is because I believe bitcoin is actually relatively bullish but the spx is relatively bearish so we are in this tricky situation where pumps will get nuked and dumps will get pumped till spx is bullish again then both pump.”

More Reading: Fidelity Report: Trillions of Dollars Could Flow into Bitcoin as a ‘Unique' Alternative Investment

The Futures & Options

While the market sentiment seems to have faltered once again, with the market trading broadly lower, the network hasn’t been busier.

Hash rate has hit an all-time new high, yet again and in terms of actual usage, the average number of transactions per day remains above 300,000 since the beginning of the year.

Bitcoin accumulation has also been on a constant upwards trend for months, with 2.6M BTC (14% of supply) currently held in accumulation addresses.

Additionally, the options market paints a different picture. Around 2000 $9k puts contracts were closed with December 25 expiry only to have more than 2000 $9k puts contracts opened with Oct. 16 expiry.

“The $11,500 area appears to be the key point of resistance for market makers, carrying plenty of gamma with it, thereby if spot remains above this level market makers will have to close hedges pushing the spot even higher,” said Denis Vinokourov of Bequant.

As for Ethereum, about 2k call contracts were opened with a strike price of $430 and Oct. 23 expiry.

“Overall, the skew profile is turning more bullish and this positive price outlook is also evidenced in the futures curve, with contango structure steepening as a result.”

However, little activity is registered in the futures curve as outflows on BitMEX stabilize. Its open interest (OI) sits at March low, while total OI levels around the $4 billion mark.

Also Read: JPMorgan: ‘Modest Headwind' for Bitcoin Price But Corporate Demand a Strong Vote of Confidence for its Future

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