Data suggests traders view $46,000 as Bitcoin’s final line in the sand

Dec. 13 will likely be remembered as a “bloody Monday” without Bitcoin (BTC) price lost the $47,000 support, and altcoin prices dropped by as much as 25% within a matter of moments. 

When the move occurred, analysts quickly reasoned that Bitcoin’s 8.5% correction was directly unfluctuating to the Federal Open Market Committee (FOMC) meeting, which starts on Dec. 15.

Investors are wrung that the Federal Reserve will sooner start tapering, which simply put, is a reduction of the Federal Reserve’s yoke repurchasing program. The logic is that a revision of the current monetary policy would negatively impact riskier assets. While there’s no way to unearth such a hypothesis, Bitcoin had a 67% year-to-date proceeds until Dec. 12. Therefore, it makes sense for investors to pocket those profits superiority of market uncertainties and this could be unfluctuating to the current correction seen in BTC price.

Top cryptos weekly performance on Dec. 13. Source: Nomics

Bitcoin price retraced 8.2% over the past week, but it moreover outperformed the broader altcoin market. That is in stark unrelatedness to the last 50 days considering the leading cryptocurrency’s market share (dominance) dropped from 47.5% to 42%. Investors could have simply fled to Bitcoin due to its relatively smaller risk than altcoins.

Tether’s unbelieve bottomed at 4%

The OKEx Tether (USDT) premium or unbelieve measures the difference between China-based peer-to-peer (P2P) trades and the official U.S. dollar currency. Figures whilom 100% indicate an excessive demand for cryptocurrency investing. On the other hand, a 5% unbelieve usually indicates heavy selling activity.

OKEx USDT peer-to-peer premium vs. USD. Source: OKEx

The Tether indicator bottomed at 96% on Dec. 13, which is slightly surly but not viperous for a 10% total cryptocurrency market capitalization drop. However, it has been over two months since this metric surpassed 100%, signaling a lack of excitement from China-based traders.

To remoter prove that the Dec. 13 price crash only slightly impacted investor sentiment, the total liquidations over the 24 hours was $400 million.

Total derivatives mart liquidations on Dec. 13. Source:

More importantly, only $300 million of long leverage contracts were forcefully terminated due to insufficient margin. This icon looks insignificant when compared to the Dec. 3 crash, when $2.1 billion of leveraged buyers had their positions closed.

There’s no excessive demand from Bitcoin bears, at the moment

To remoter prove that the crypto market structure was not strongly unauthentic by the sharp price drop, traders should unriddle the perpetual futures. These contracts have an embedded rate and usually tuition a fee every eight hours to wastefulness the exchange’s risk.

A positive funding rate indicates that longs (buyers) are taxing increasingly leverage. However, the opposite situation occurs when shorts (sellers) require spare leverage, and this causes the funding rate to turn negative.

Bitcoin perpetual futures 8-hour funding rate. Source: Coinglass

Considering that most cryptocurrencies suffered considerable losses on Dec. 13, the overall market structure held nicely. Had there been excessive demand for shorts who were betting on a Bitcoin price waif unelevated $46,000, the perpetual futures eight-hour funding would have gone unelevated 0.05%.

Tether trading at a 4% unbelieve in the China-based markets, $300 million in long contract liquidations and a neutral funding rate is not a sign of a withstand market. Unless these fundamentals transpiration significantly, there is no reason to undeniability for $42,000 or lower Bitcoin prices.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should self-mastery your own research when making a decision.

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