Market Wrap: Bitcoin Hovers Around $27K While ETH/BTC Pair Goes Bullish

Bitcoin was largely trading in a narrow, low volume range on Monday, while the ETH / BTC charts have seen some profit-taking from Bitcoin in ether.

  • Bitcoin (BTC) is trading around $ 26,822 as of 9:00 PM UTC (4:00 PM ET). Increase of 2.3% in the last 24 hours.
  • Bitcoin’s 24-hour range: $ 25,759 to $ 27,447 (CoinDesk 20)
  • BTC very close to its 10-hour and 50-hour moving averages on the hourly chart, a sideways signal for market technicians.

Bitcoin trading on Bitstamp since December 25th.

Source: TradingView

Bitcoin’s price movement stagnated on Monday, trading in a range of $ 27,000-27,200 for many hours, according to CoinDesk 20 data. The lack of movement follows a Sunday when Bitcoin cracked an all-time high of $ 28,352, fueled by a bull run triggered on December 25th.

According to the over-the-counter retailer Alessandro Andreotti, a short break is a given. “I think it’s just a small retracement, a little break after a week of all-time highs,” Andreotti told CoinDesk. “BTC is definitely still in bullish territory.”

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Following Sunday’s run of over $ 4 billion on major CoinDesk 20 exchanges, the spot trading balance on Monday is much lower at $ 1.8 billion at press time. “Given the speed of yesterday’s surge, especially after the rally of the past few days, a slight decline is normal,” said David Lifchitz, chief investment officer of quant trading company ExoAlpha.

Bitcoin spot volume on eight major exchanges.

Source: Shuai Hao / CoinDesk Research

“Bitcoin continues its strong upward trend as more and more retail investors switch to Bitcoin during the holidays,” said Jason Lau, chief operating officer of the San Francisco-based cryptocurrency exchange OKCoin. According to Lau, however, the flat spot volume is unlikely to be a trend for the next year. “With the [U.S. economic] By signing the stimulus package, Bitcoin’s attractiveness as a store of value could continue until 2021. “

In the derivatives space, futures liquidations have helped fuel the recent Bitcoin price surge. This is reflected in the number of liquidations – which corresponds to a margin call in traditional markets – on BitMEX. There have been more than $ 116 million in liquidations in the past three days, with short positions being preferred as buy liquidations hit $ 65 million.

BitMEX bitcoin liquidations in the last three days.

Source: Skew

“There is a clear shortage of sellers at this point as all leveraged shorts are being liquidated,” wrote quant trading firm QCP Capital in its investor note on Monday. “The bull story remains clear: the increasing institutional acceptance of BTC is driving the price up and feeding the retail FOMO, which then spans across the crypto.”

Other analysts agree with QCP that Bitcoin’s price surge is attracting more attention to other cryptocurrencies, especially ethers. “I think the BTC price slowdown is giving the altcoin season some air,” said Misha Alefirenko, founder of crypto market maker VelvetFormula. The ether futures market is trending up again after a record high of $ 2.2 billion in open interest lost some of its steam after Dec. 19.

Ether futures are open for the last three months.

Source: Skew

The news that CME is entering the Ether Futures game is a positive sign of ongoing institutional interest in crypto, according to OKCoin’s Lau.

“Ethereum has maintained the upward trend alongside Bitcoin and has reached its highest level since May 2018,” said Lau. The CME Ethereum Futures offering in February “could have an enormous impact due to the exposure [ether] to more institutional investors. “

ETH / BTC switches to bull mode

Ether (ETH), the second largest cryptocurrency by market capitalization, gained 8% on Monday, trading at $ 732, and rising 8% in 24 hours at 9:00 p.m. UTC (4:00 p.m. ET).

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The ETH / BTC trading pair, a common offering on most exchanges, suddenly turned bullish on Monday after a long bearish cycle. This pair indicates the strength of ether against Bitcoin. The bullish signal on the hourly charts, including a spike in volume on Coinbase, suggests traders are selling Bitcoin for airwaves.

The ETH / BTC trading pair on Coinbase last month.

Source: TradingView

According to Vishal Shah, an options trader and founder of the derivatives venue Alpha5, some profit-taking from Bitcoin in ether is the main culprit. “I think it’s the spillover effects of BTC exhaustion,” Shah told CoinDesk. He added that it is likely that hardcore crypto traders will make more profits this bull cycle, driving the ETH / BTC hourly chart higher. “This whole rally was born out of Bitcoin [its] hard to see just shift gears. And if they do, it is likely not the same investor. “

Other markets

Digital assets on CoinDesk 20 are mostly green Mondays. Notable Winners as of 9:00 PM UTC (4:00 PM ET):

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  • Oil was down 1.3%. Price per barrel of West Texas Intermediate Crude: $ 47.66.
  • Gold was down 0.33% and was trading at $ 1,872 at press time.
  • The US 10-year Treasury yield fell to 0.928 on Monday and was in the red at 0.18%.

The CoinDesk 20: The assets that matter most to the market

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