Bitcoin Faces Volatile Swings Amid Weak Liquidity: Analysts Predict Slow Recovery and Potential Fall
Summary:
On January 15, Bitcoin experienced significant fluctuations. Analysts warned that weak liquidity and unscheduled Wall Street holiday could lead to volatile price movements. The recovery from the recent 15% plunge could last over a month, which could favor Ethereum and other alternatives if Bitcoin's dominance wanes. Looking forward, a heavier price fall could occur within the next 30 days prior to the block subsidy halving event in April. Despite recent volatility, Bitcoin's trading range remains steady.
On January 15, Bitcoin (BTC) experienced a series of boundless fluctuations, concurrent with an analyst's warning over the liquidity of the order book. Tracking data from Cointelegraph Markets Pro and TradingView showed a jump to nearly $43,000 before BTC's price instability kicked in again leading to a market decline of 1.5% within 60 minutes. This instability took place on a Wall Street holiday, making room for more unforeseen price changes.
Skew, a well-known trader, mentioned in recent X (previously Twitter) posts that overall spot markets didn't have ample depth to ensure steadiness in smaller timeframes. He suggested that a surprise 1K candle might occur due to scarce liquidity. Skew's opinion was that if the price gets above $42.8K, market bulls might gain dominance, otherwise the market could be in a vulnerable state allowing for bears to take over. Per Skew, the round trip to $43,000 was dominated by derivatives, implying it was potentially not going to be sustainable.
Meanwhile, Matthew Hyland, another analyst, anticipated that the recovery from the recent 15% plunge could take well over a month. Hyland suggested Bitcoin could be stationary for a while, based on a chart of buying and selling volumes. A comparison to instances with similar volume in the past showed at least 3-4 weeks of stagnant prices. This could be advantageous for Ethereum and other alternatives if Bitcoin's dominance decreases.
As for future expectations, Rekt Capital, a noted trader and analyst, sketched a potential route for BTC price movements before the block subsidy halving in April. Substantial last-minute increases typically become visible around two months prior to such an event. So this would limit any big downturns from bears. Rekt Capital points out that if BTC is to face a heavy fall during its Pre-Halving period, it would likely happen within the upcoming 30 days.
Finally, a follow-up post from Rekt Capital kept BTC/ USD squarely within its weekly trading range despite recent fluctuations. This news article does not serve as investment advice or recommendations. Every financing and trading action carries risk, and readers are advised to do their own investigation prior to decision making.
Published At
1/15/2024 8:01:00 PM
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