Bitcoin took a breath today as prices consolidated around the $35,000 level. Yesterday, volumes across futures exchanges set a new record, with over 4.5 million Bitcoin futures contracts changing hands.
The underlying fundamentals of Bitcoin and its network have never been stronger. Which, given the tongue-in-cheek reporting that Bitcoin has now entered a bear market due to it's 20% decline from its all-time high, goes to prove that price swings do not always tell the whole story.
Short-term leveraged traders with long positions have been forced to the sidelines following large liquidations across exchanges - these bulls will be back soon enough.
So let's have a look at what the blockchain data shows.
The number of active addresses: ATH
Mining difficulty: ATH
The hash rate: ATH
Illiquid supply: ATH
The number of wallets with a non-zero balance: ATH
The number of whales: ATH
Conclusion: Now is probably not the time to panic. Bitcoin's pull back from its ATH is not a surprise, and picking the point at which it will happen will always be an impossible task.
The question remains the same: Have we already seen the highest price Bitcoin will ever trade?
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Bitcoin has settled today, with a trading range that looked at resistance at $35,868 and support at $32,300. Neither level was attacked with vigor, leaving prices fluctuating around mid-range.
A break higher through $35,868 will see Bitcoin trade back to the $38,180 level, with resistance overhead at $40,000. On the downside, a move back below $32,300 will likely see more volatility enter the market as the bears push hard for a sub $30,000 print. $28,000 should act as firm floor on prices if $29,980 gives way.
The natural ebb-and-flow of price, has replaced the bullish moves seen through October and early November
It looks like crypto isn’t correlated to traditional markets, at least not during this past session.
Investors aren’t ready to give up on equities yet.
One of the big factors contributing to bitcoin’s expansion over gold is that millennials are becoming more knowledgeable of the investing world.
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