Bitcoin brought new volatility on January 6th as range trading behavior made the price shake for the first time in weeks.
BTC candlestick chart 1 hour | Source: TradingView
The open interest is still high
Data from TradingView shows that Bitcoin price fell to $ 42,000 for the first time since December.
While not the bullish breakout that many expected, the move is anticipated nonetheless. Essentially, Bitcoin “fills in” the void that remained after falling rapidly to $ 41,800 early last month.
These lows were the result of a mass liquidation. While long positions have lost money during this time, many remain skeptical that a return to $ 42,000 will be enough to create a bottom.
“It’s really surprising that we don’t see many daily sales these days when a lot of longs have already been built. An upward movement is still possible. All I know for sure is that this party is just getting started, ”wrote analyst William Clemente in a series of articles. tweets about this action.
Source: William Clemente
Clemente is among those who predicted more volatile conditions this month and notes that much of the Open Interest (OI) of Bitcoin futures remains. Open interest hit an all-time high over the week.
As always, zooming out on the chart brings a sense of comfort and familiarity with Bitcoin price history versus history.
According to analyst TechDev, the Fibonacci levels suggest that Bitcoin is at least still trying to copy the patterns from the previous halving cycle.
“Compared to previous cycles, the price action / indicator and volume behavior suggest that 2021 is indeed a year of consolidation (similar to 2019-Q3 / 2020) and this will likely result in further market momentum ahead of the next big correction. ”
The source: TechDev
The scariest market since July 2021
For the average retail investor, however, there seems to be little hope left – at least for the day.
The fear and greed index halved to 15/100 as prices traded lower – deep in the “extreme fear” zone and at their lowest level since last July.
At that point, BTC was trading at a maximum of $ 33,000.
Cryptocurrency Fear and Greed Index | Source: alternative.me
Panic and fear seem to spread through 2022.
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