While Bitcoin’s key metrics don’t paint a pretty picture, the bears could be running out of steam. Contrary to analyst warnings that Bitcoin could fall to $38,000 “before the breakout,” CoinShares and Arcane Research suggest the trend could change.
In summary, institutional outflows over the past 4/5 weeks have been negative, totaling $55 million. Total assets under management fell to a three-month low of $35 billion in the middle of last week.
CoinShares findings show that large investors in the Bitcoin ecosystem, leveraging companies such as Grayscale, CoinsXBT, ProShares, and ETC Group, have reduced their exposure to digital assets.
Their action is likely due to the “extreme fear” sentiment over the past 2 months and spot bitcoin buying volume hitting a 6-month low, according to the data. statistical. As the Fear and Greed Index enters its third consecutive month of extreme fear, it marks the second time in the index’s history.
Traders are also turning away from the king of crypto. According to Arcane Research, the 7-day average BTC trade volume is $3.4 billion. This is the lowest number since July 2021, the bottom of the mini bear market that took place from May to July 2021.
Investors and space watchers know that after this point, the price of BTC has surged more than 60% between August and October 2021, heavily boosted by institutional investment.
With Bitcoin’s 30-day price action at a 12-month low (2.5%), it is expected to bounce back.
Twitter analysts predict bullish action. Famous bitcoin bull GalaxyBTC to speak that $80,000 is coming soon while Tradermayne notes the “nth low”.
Bitcoin bounces off $41,000
Bitcoin rallied sharply from $41,000 on Jan. 20, disappointing bears waiting for the price to break into lower territory.
BTC/USD 1 hour chart | Source: TradingView
Data from TradingView shows BTC adding $1,000 after falling nearly $41,000 for the first time since January.
In what may be a temporary recovery move, Bitcoin remains range bound with no noticeable attacks on resistance – something all too familiar to spot traders over the past few days.
“Good bounce in bitcoin, but I would be happier to return to the $42,400 area,” said Michaël van de Poppe summary in his latest Twitter update.
In one post Earlier in the day, Van de Poppe highlighted $38,000 as the “last” line to hold if a new breakdown occurs.
“The final test for Bitcoin is the $38,000-40,000 range. Holding there will confirm to buyers that they are entering a + bullish divergence to reverse.”
Others are praising the market’s current strength given the similar run up in US stocks ahead of Wall Street’s opening.
I don’t trust that #BTC to dispose
We’re still in the gold pocket, have a bull div and SPX just pumped 40 holds off the low
Think we’re pumping from here pic.twitter.com/O81srkoXWR
— CRG (@MacroCRG) January 19, 2022
“I believe there is no BTC dump. Price is still in gold, there are some bullish divergences and SPX just pumped 40 off the low. Think BTC pumps from here.”
Earlier this year, prominent Bloomberg Intelligence analyst Mike McGlone, who provided forecasts for Bitcoin and stock market developments, said cryptocurrencies and stocks will continue to exhibit greater correlation this year.
However, another interesting topic this week focused on the performance gap between Bitcoin and Nasdaq, in which proponents to hope BTC will definitely “disconnect” from the downtrend of this indicator.
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