Bitcoin fills $42K December price wick as analyst says ‘party just getting started’

Bitcoin (BTC) delivered contemporary volatility on Jan. 6 as rangebound habits noticed its first shake-up in weeks.

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

Open curiosity stays excessive

Data from Cointelegraph Markets Pro and TradingView confirmed BTC/USD dropping in a single day to hit $42,000 for the primary time since December.

Although not the upside breakout that many had wished, the transfer was nonetheless predicted, Bitcoin basically “filling” the area left after it briefly depraved to $41,800 early final month.

Those lows had been the results of a liquidation cascade, and whereas lengthy positions additionally felt ache this time round, scepticism remained as as to whether the revisiting of $42,000 had been sufficient to place in a price ground.

“Honestly stunned we did not see extra of a flush at the moment if this was aggressive longs constructed up. Could nonetheless resolve to the upside,” analyst William Clemente wrote in a collection of tweets in regards to the motion.

“All I do know for positive is that this get together is just getting began.”

Clemente was amongst these already calling for extra risky circumstances this month and famous that almost all of Bitcoin futures open curiosity (OI) remained. As Cointelegraph reported, OI had hit all-time highs in BTC phrases in the course of the week.

As ever, these zooming out discovered consolation and familiarity in Bitcoin price motion versus historic habits.

Fibonacci ranges analyzed by fellow analyst TechDev confirmed that Bitcoin was nonetheless at the very least trying to repeat patterns constructed up from earlier halving cycles.

“Comparisons to previous cycles apart, price/indicator motion and quantity habits counsel to me that 2021 was successfully a yr of consolidation (much like 2019-Q3 2020) and that’s prone to result in one other market impulse earlier than the following main correction,” he added in his personal set of posts as the market started to dip.

Market most fearful since July 2021

For the typical retail investor, nevertheless, it seemed as if there was little hope left — at the very least on the day.

Related: New yr, identical ‘extreme fear’ — 5 issues to look at in Bitcoin this week

The Crypto Fear & Greed Index halved in the course of the dip to fifteen/100 — deep throughout the Index’s “excessive worry” zone and its lowest degree since final July.

At that point, BTC/USD traded at a most of $33,000.

Crypto Fear & Greed Index. Source: Alternative.me

As Cointelegraph reported, jitters in sentiment had been already palpable as 2022 started.