Bitcoin (BTC) accumulated over $ 17,000 on November 28 after a major correction of $ 19,400. In the near future, traders expect the dominant cryptocurrency to see another sharp fall.
There are three main reasons why traders expect a deeper decline in the near future: historical cycles, Fibonacci sequences and standard open interest in the futures market.
Historical cycles point to deeper BTC correction
The BTC price has often fallen 20-30% in previous beef markets as the rally to almost $ 20,000 in 2017. Although the rally continued after that, there were major corrections when the derivatives market was crowded.
Many traders now say that the bitcoin price should adjust the range between $ 13,800 and $ 14,500 if a similar picture emerges.
In addition, some technical analysts are considering a worst-case scenario, with BTC falling to the top of the August 2020 rally. As a result, the bitcoin price will be around $ 12,468.
A trader under the pseudonym “Salsa Tequila” said that the technical outlook for Bitcoin is relatively clear.
If BTC rises above $ 17,500 and stays above $ 17,500, the trend will be bullish again. However, if the BTC stays below $ 17,500, the fall to the $ 11,000 to $ 13,000 range should not come as a surprise. The seller wrote:
My expectations for BTC in USD: 1) bearish below the $ 17 500 range. 2) bullish if we break through $ 17,500, in which case the purchase falls. 3) Room $ 18.7k = significant resistance just before NOTE (IF CAN BE). We see [11-13 thousand dollars]. Net sales will not exceed $ 14.5 thousand. ”
As Cointelegraph mentioned earlier, traders set the 0.618 level using the Fibonacci sequence as a potential area of interest for buyers.
The Fibonacci sequence includes all Bitcoin collections up to $ 19,400 and places the 0.618 level at around $ 13,500. In the hierarchy, the 0.618 reversal level is a potential reversal of the trend.
Open interest in the futures market is still high
When open interest in the bitcoin futures market stays above $ 1 billion, the price of BTC tends to fall.
Earlier today, Cointelegraph reported that throughout BTC’s history, the price has often corrected when there was an increased level of trading activity in the futures market.
According to Skew, open interest in the major futures exchanges currently exceeds $ 1 billion. OKEx, Binance Futures and CME, the three largest bitcoin futures markets, reached their highest open interest rates ever: $ 1.4 billion, $ 0.94 billion and $ 0.93 billion, respectively.
However, other traders believe that Bitcoin may rise to $ 18,000 before any withdrawal, or even see the general trend continue to new heights.
Michael Van de Pope, a full-time trader at the Amsterdam Stock Exchange, said earlier today that the low price range for BTC is currently over $ 16,000.
This can lead to an increase of up to $ 18,000. Whale groups also show that the $ 16,000 area remains strong support.
Similarly, a trader under a pseudonym known as “Crypto Capo” said that based on previous fractals, BTC could first raise $ 18,000 before a new major dip occurs.