Modest bullishness arguably is what now characterizes the market after some 6% gains overnight for Bitcoin.
Bitcoin (BTC) lost momentum at $51,500 on Dec. 24 as traders weighed the odds of a “Santa rally” coming true for Christmas.
BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView
BTC sees potent long-term retest
Opinions were mixed among weary traders about the strength of the rally and whether it could endure for long.
Still in its familiar range despite the overnight uptick, Bitcoin needed to show its muscle on longer timeframes, Cointelegraph reported analysis as saying earlier.
For filbfilb, co-founder of trading platform Decentrader, a combination of low funding rates and top traders turning long at the expense of more bearish retail among other triggers served as reason to be more hopeful.
Top traders long, normies fading the move up
OI up 2.86 bn / 40%
Sitting right below 10x liquidations
Happy Christmas. pic.twitter.com/LvRSAN8iTN
— filbfilb (@filbfilb) December 24, 2021
Trader analyst Rekt Capital meanwhile noted that the reversal currently meant that Bitcoin had “successfully retested” the top of a falling wedge structure in place for much of 2021. BTC/USD had originally broken out of the wedge at the end of September.
— Rekt Capital (@rektcapital) December 24, 2021
Data from the research arm of derivatives exchange Deribit added that funds were getting more bullish about a Bitcoin price in the mid-$50,000s in January.
“Additional funds jumping into the NewYear play,” the firm tweeted Friday.
“This time, refocus on BTC, as one large Fund buys a strip of Jan14 52-56k Calls x1200 around 49.5k spot, just before spike >50k.”
At press time, BTC/USD stood at just under $51,000.
$4,000 ETH returns
Bitcoin managed to post stronger daily gains than Ether (ETH) on the day as the largest altcoin nonetheless returned above $4,000.
The top ten cryptocurrencies by market cap were firmly in the green, led by ongoing success for Terra’s LUNA token.
The exception was a flat XRP, which had nonetheless staged its own rally earlier in the week.
ETH/USD 1-hour candle chart (Bitstamp). Source: TradingView
“And just like that, people want to buy altcoins again,” Cointelegraph contributor Michaël van de Poppe summarized.