Bitcoin's price has dropped below the $100,000 resistance level after failing to maintain its upward momentum, leading to uncertainty about its future direction. The cryptocurrency is consolidating below $100,000 with the $90,000 support level as the next potential target. Analysis of the Bitcoin futures market suggests potential volatility due to high open interest levels.
Bitcoin's price has failed to maintain its upward trajectory after falling below the $100,000 resistance level. This decline has introduced significant uncertainty regarding the future price movements. On a daily chart, the price has been consolidating below $100,000, following a brief surge above it a couple of weeks ago that resulted in a new all-time high. However, the market recently failed to break through the $100,000 level and was rejected downwards.
Consequently, the $90,000 support level is likely the immediate target. The market's reaction to this level will dictate the short-term price action for Bitcoin. The 4-hour timeframe provides a clearer perspective on the sideways price action. Initially, the market was forming higher highs and lows within an ascending channel. However, it has since broken this pattern downwards and retested it twice. With the RSI also exhibiting values below 50%, suggesting bearish momentum, the market is likely to drop towards the $90,000 level before a potential bullish continuation. The sentiment in the Bitcoin futures market has proven valuable in recent years, assisting analysts in predicting potential short-term volatility. This chart presents the open interest metric, which measures the total number of open perpetual futures contracts on derivatives exchanges. As the chart illustrates, open interest values have reached all-time highs, even as the market has fallen below $100,000 and ceased trending. This could indicate potential short-term volatility driven by liquidation cascades. Therefore, investors should exercise caution when investing in Bitcoin at present. Disclaimer: Information found on CryptoPotato is that of the writers quoted. It does not represent the opinions of CryptoPotato on whether to buy, sell, or hold any investments. You are advised to conduct your own research before making any investment decisions. Use provided information at your own risk. See Disclaimer for more information
BITCOIN PRICE VOLATILITY SUPPORT OPENINTEREST
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