This is solely a technical analysis post but includes some notes from last weeks Glassnode newsletter.
From a technical analysis, if you followed from last week, we posted an idea regarding a BTC long setup with BTC bouncing off the lower region of a major support level. We saw this idea did not pan out with catalyst events with the Fed announcing inflation being no longer "transitory" and the tapering of asset purchasing that has been a major factor of keeping our economy afloat since COVID-19. There is also the Omnicron strain that was announced, but hasnt garnered enough data to see if it would be a more devastating strain then the previous.
With these new catalyst events, we can see a new head and shoulders chart pattern play out, with BTC falling to a neckline around $30k. We may have some time for this event to happen, as we will see major hints to this at the $51k and $41k level.
Here are some past notes from the Glassnode Onchain Newsletter released this past Sunday.
"When price failed to hold, sell pressure triggered a cascade of long liquidations. Within hours, Futures Open Interest had been flushed of $5.4 billion in contracts, a reduction if -24.5% in total value from the space."
"The futures market is not the only derivatives space that has seen high volume and interest in recent weeks. Options activity tends to spike on days of sell-offs and rallies where hedge traders look to capture volatility premiums. Last week's flush saw the second highest hourly options volume since mid-May— more than $1.7 billion per hour.
Additionally, Options Volume has increased more than >250% since July, now regularly settling over $1 billion daily."
This was one of my favorite points in the newsletter:
"The balance of BTC on exchanges is a metric worth monitoring in periods of volatility, as it marks the primary barrier to exit for holders: placing coins on an exchange for sale.
We observe the flow of coins to/from exchanges here by looking at Exchange Net Transfer Volume. During the capitulation in May, exchanges saw a notable and sustained uptick of BTC inflows, with periods of 10.4k and 13.9k net BTC deposits. This contrasts with the present moment, where recent peak exchange inflows are a fraction of the size, at 2k and 3.2k BTC. Bitcoin holders aren't behaving as they have in prior moments of weakness, hinting at an underlying confidence, and largely confirming weakness was more heavily influenced by derivative markets rather than spot selling."
More here:
insights.glassn...n-week-49-2021/?utm_source...
From a technical analysis, if you followed from last week, we posted an idea regarding a BTC long setup with BTC bouncing off the lower region of a major support level. We saw this idea did not pan out with catalyst events with the Fed announcing inflation being no longer "transitory" and the tapering of asset purchasing that has been a major factor of keeping our economy afloat since COVID-19. There is also the Omnicron strain that was announced, but hasnt garnered enough data to see if it would be a more devastating strain then the previous.
With these new catalyst events, we can see a new head and shoulders chart pattern play out, with BTC falling to a neckline around $30k. We may have some time for this event to happen, as we will see major hints to this at the $51k and $41k level.
Here are some past notes from the Glassnode Onchain Newsletter released this past Sunday.
"When price failed to hold, sell pressure triggered a cascade of long liquidations. Within hours, Futures Open Interest had been flushed of $5.4 billion in contracts, a reduction if -24.5% in total value from the space."
"The futures market is not the only derivatives space that has seen high volume and interest in recent weeks. Options activity tends to spike on days of sell-offs and rallies where hedge traders look to capture volatility premiums. Last week's flush saw the second highest hourly options volume since mid-May— more than $1.7 billion per hour.
Additionally, Options Volume has increased more than >250% since July, now regularly settling over $1 billion daily."
This was one of my favorite points in the newsletter:
"The balance of BTC on exchanges is a metric worth monitoring in periods of volatility, as it marks the primary barrier to exit for holders: placing coins on an exchange for sale.
We observe the flow of coins to/from exchanges here by looking at Exchange Net Transfer Volume. During the capitulation in May, exchanges saw a notable and sustained uptick of BTC inflows, with periods of 10.4k and 13.9k net BTC deposits. This contrasts with the present moment, where recent peak exchange inflows are a fraction of the size, at 2k and 3.2k BTC. Bitcoin holders aren't behaving as they have in prior moments of weakness, hinting at an underlying confidence, and largely confirming weakness was more heavily influenced by derivative markets rather than spot selling."
More here:
insights.glassn...n-week-49-2021/?utm_source...