Market Wrap: Bitcoin Drops Shortly Below $ 33.5K While Ether Calls Dominate Options

Bitcoin is recovering after a steady decline in prices while ether options traders are anticipating another high tide mark after reaching an all-time high of $ 1,439.

  • Bitcoin (BTC) was trading at around $ 35,023 at 21:00 UTC (4 pm ET). Slip 4.1% over the previous 24 hours.
  • Bitcoin 24 Hour Range: $ 33,430- $ 36,794 (CoinDesk 20)
  • BTC above the 10-hour averages but well below the 50-hour moving averages on the hourly chart, a sideways signal for market technicians.

Bitcoin trading on Bitstamp since January 16.
Source: TradingView

Bitcoin’s price fell on Wednesday, going as low as $ 33,430 around 15:00 UTC (10 am ET), according to CoinDesk data 20. It’s been a long and downward direction mainly for the price. The world’s oldest cryptocurrency peaked at $ 36,794 24 hours ago. It fell over $ 3,300 before rising slightly, at $ 35,023 at press time.

Constantin Kogan, a partner in crypto investment firm Wave Financial, has a bearish outlook, forecasting a fall to at least $ 30,000. “This is where the bulls will start to buy back. If we pass this mark it could fall to almost $ 26,000, ”he told CoinDesk. “According to a Bank of America survey, bitcoin has long become the busiest form of trade.”

Read more: Bitcoin Massive Trade After Passing ‘Long Tech’: Bank of America

Kogan dubbed Wednesday’s crypto loss “a slight squeeze.” Certainly a squeeze in the derivatives market has occurred over the last 24 hours. The Jan. 19 long liquidations, which included trading early Asian hours leading to Wednesday’s market, totaled $ 121 million. “Liquidations” is equivalent to a margin call in crypto where a leveraged trader position is removed.

Bitcoin liquidations on leveraged locations in the last three months.
Source: Bybt

On January 10, the last time a large number of long liquidations occurred, $ 555 million in bull-leveled trades was called in and the bitcoin market collapsed to $ 30,300.

Anyway, Michael Stark, a market analyst at broker FX Exness, expects larger financial players to continue plowing dollars into the bitcoin market as investors continue to avoid “risk-free” assets like gold and look into “risk-ahead” instruments ”Such as equities and crypto.

“Bitcoin will almost certainly keep going up eventually, but everything needs to stop here and there,” said Stark.

Read more: BlackRock Enter 2 Forward Funds to Invest in Bitcoin Futures

With a new US president, who was inaugurated on Wednesday, bringing a new set of policies – including the expectation of more fiscal stimulus – traders may become optimistic that more dollars could flood the economy at higher crypto prices. The bitcoin market as a whole is still in bull mode; less than a month ago, the spot price per 1 BTC was below $ 25,000.

Bitcoin historical price last month.
Source: CoinDesk 20

However, nothing is certain, notes Joshua Mahony, senior market analyst on the IG trading platform. The question for marketers now is whether the United States Congress remains politically divided, “with Biden hoping Democrats will vote along party lines to help them push through a host of grandiose spending packages , ”Said Mahony.

Options traders like calls on ether

The second-largest cryptocurrency by market capitalization, ether (ETH), was down Wednesday, trading at around $ 1,338 and falling 3.8% in 24 hours at 21:00 UTC (4:00 pm ET).

Read more: Record Ether Highlights Can Drive Cryptocurrency to $ 10.5K: Fundstrat

The price of Ether fell on Wednesday as well, though not as much as bitcoin. In fact, today’s options orientation in the ether market greatly favors calls, according to Skew. Demand options are the right, but not the obligation, to buy an asset at a set price and time. Calls currently dominate those options, 66% versus 34% for gifts, which are contracts that give the right, but not the obligation, to sell.

Today’s ether options are flowing.
Source: Skew

Kogan Wave Financial, while bearish on bitcoin for the time being, expects more bullish results out of ether in the near term. Options traders seem to agree, given the way they are positioned. “Bitcoin’s rolling ether expectation did not follow, indicating the strength of the ETH trend,” said Kogan. “We’re waiting for a $ 1,300 (but) downside in a couple of days, growth will resume and very soon we may see the $ 1,800 mark.”

Other markets

Digital assets on the CoinDesk 20 are almost all Red Winners of Notable Wednesday at 21:00 UTC (4:00 pm ET):

  • Oil was up 0.41%. Barrel price of raw Central Texas Intermediate: $ 53.21.
  • Gold was in the green 1.6% and at $ 1,869 at press time.
  • The 10-year US Treasury bond yield fell on Wednesday to 1.082 and in the red 0.77%.

The CoinDesk 20: The Most Important Assets to Market