After peaking at $ 33,350 today, Bitcoin fell to $ 30,000 on leading exchanges a few minutes ago. Despite this rapid sell-off, buyers bought the dip.
BTC is now trading for $ 31,300 and is up more than 7.5% in the past 24 hours. Altcoins like Ethereum also remain green despite the decline.
Many attribute this price volatility to a weekend. While BTC was largely a retail-focused market, institutions have started trading, often resulting in increases in liquidity and volume on weekdays as opposed to weekends.
Related Reading: Wall Street Veteran Kickstart’s Own Bitcoin Fund with a $ 25M investment
Bitcoin Blow-Off Top
Some have argued that after gaining nearly $ 4,000 in a single day, Bitcoin may experience a blow-off top.
One trader shared this trade below and found that he was shorting Bitcoin near the highs due to overbought indicators. As the graph below shows, certain indicators showed that Bitcoin’s price movement was significantly overheated and likely needed time to reset.
I just entered a little short.
Will add more if I see a nice reaction.
I’m so sorry.
I understand if you want to follow me now. $ BTC pic.twitter.com/ngaLaFBPuk
– Byzantine General (@ByzGeneral) January 2, 2021
What is giving these traders a break, however, is the quick rebound that BTC has just seen.
While Bitcoin was only trading at $ 30,000 a few minutes ago, it is now trading at $ 31,300. The rapid restoration of the cryptocurrency’s price action can show that there is a latent bid on the cryptocurrency that appears with every break-in.
This buying pressure is likely institutional. For example, Grayscale added nearly 13,000 BTC to its holdings in late December to account for the inflow of institutional capital.
There’s also news that companies like SkyBridge Capital are buying tens of millions of dollars worth of BTC.
Related Topics: 3 Bitcoin On Chain Trends Show A Macro Bull Market Is Brewing
Featured Image from TradingView.com’s Unsplash Chart Price Tags: xbtusd, btcusd, btcusdt Bitcoin drops 8% to $ 30,500 on a quick weekend price action