Bitcoin (BTC) has recovered in the last two days after falling to $ 28,850. However, after a rapid recovery, the BTC failed to overcome the severe resistance of $ 33,000 on January 23, and at the time of writing it fell below $ 32,000.

Coinbase premium return is bullish, but what now?
Earlier, when the price of bitcoin began to fall below $ 32,000, BTC traded on Coinbase much less than it did on Binance.

Coinbase’s lack of premiums was worrying for two main reasons. First, Bitcoin naturally trades higher on Coinbase due to Tether’s small premium.

Second, when Coinbase sees a lower price than other exchanges, it shows that there is significant seller pressure in the US market.

As bitcoin sales pressure in the US market began to rise, the price of bitcoin fell in a short time.

But almost immediately after BTC recovered from $ 30,000, Coinbase returns. At the time of writing, the BTC on Coinbase is about $ 40 higher than Binance.

The resumption of Coinbase’s premiums after almost 12 hours is a positive sign of a potential trend reversal.

Signs of “institutional burnout”
In the short term, however, everyone is far from optimistic. Analysts at QCP Capital, a group of traders from Asia, see several indications of “institutional burnout”.

Given that institutional demand for Bitcoin from the United States has been the main story lately, the rally could be threatened if institutions’ appetite for bitcoin declines. They said:

Signs of Institutional Burnout: We conducted a time zone analysis that divided Bitcoin’s movement into Asian and US hours (12 hours each). Since March last year, there has been a clear pattern that the United States buys relentlessly while Asian whales and miners have been shown. “”

Traders confirmed that the strength of the US trading session eased for the first time.

In fact, in the last week, most of the pressure has come from bitcoin sellers from Asia. This represents a major shift in market sentiment. They added:

“However, after the peak of the BTC two weeks ago, the US monitoring force lost momentum for the first time. This is a clear sign of exhaustion from demand from US institutions and companies that have been the main drivers behind this bullish move.”
What comes after Bitcoin?
Bitcoin is threatened with a corrective phase during the first quarter of 2021 if institutional demand for BTC falls.

Organizational platforms and mechanisms, such as shades of gray, continue to see strong influxes, indicating strong institutional demand. Meanwhile, MicroStrategy continues its policy of buying bitcoins on every dip with the last purchase on Friday with a total value of $ 10 million.

“Today, $ 31,000 was a pocket of strong support, so at least not everyone is selling,” said Chad Stinglas, chief trading officer at Crosstower, a digital assets capital firm.

“We have to wait and see if the wall stays or if the institutions continue to pile up. If they do, the trend is likely to come back and continue. If it disappears into the background and waits for further regulatory guidance, it will be aware of the shortcoming. of customer flows. ”
At the same time, the possibility of a broader correction remains if the US market continues to see a general decline in appetite for Bitcoin accumulation, especially if the dollar continues to recover in 2021.

Source: CoinTelegraph