Bitcoin Price Analysis: BTC Dips, This is the Key Level to Watch

cropped potato fav2 32x32 1

All markets are having a hard time during Monday’s trading session and Bitcoin is no exception. The cryptocurrency is down just shy of 2 percent in the past 24 hours while altcoins are mostly in red.

Option Market Analysis

The rising cases of the highly transmissible Omicron caused fear in all markets. Investors are worried about lockdowns which may have negative effects on the economy. In the options market, Short-dated implied volatility also increased accordingly to fear.

Bitcoin dipped below $46k. Traders hedged their portfolios by selling calls and buying puts. Over the previous two days, options traders bought calls for $50k, $55k & $60k strikes for the following year’s expiries. It seems that they are still optimistic about the upcoming months.

img1
Chart by Laevitas.ch
img2
Chart by Laevitas.ch

Technical Analysis (short-term)

After testing the lower Bollinger band on an 18-hour time frame, it seems the price might react to this formed support level. A Bollinger band squeeze can be seen in lower time frames. Therefore, a bullish divergence is forming on the 18-hour chart but is not confirmed yet. It will be confirmed by closing a candle above $49k.

img3
Chart by TradingView

Technical Analysis (long-term)

14 EMA on 4D Heiken-Ashi has been a good support level for Bitcoin in the long term. The directional movement index (DMI) can underline the strength and direction of a price movement. Bitcoin is below this EMA since breaking it down. Also –DI>+DI, but ADX value suggests a weak trend. In the following days, a pull-back to the EMA can be expected.

img4
Chart by TradingVIew

Onchain Analysis

Interestingly, the main sell-pressure (~83%) in the last 7D were the coins last moved (bought) at >$45K Purple square aka “Top Buyers.”

These top buyers almost have 31% of the supply in their possession (blue square). This means we have not seen significant selling pressure from old coin holders.

img5
Source tsypruyan
img6
Source tsypruyan

The above analysis was complied by @N__E__D__A, and @CryptoVizArt. Data provided by @tsypruyan exclusively for CryptoPotato.

SPECIAL OFFER (Sponsored)

Binance Free $100 (Exclusive): Use this link to register and receive $100 free and 10% off fees on Binance Futures first month (terms).

PrimeXBT Special Offer: Use this link to register & enter POTATO50 code to get 50% free bonus on any deposit up to $1750.

Disclaimer: Information found on CryptoPotato is those of writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information.

Cryptocurrency charts by TradingView.