Bitcoin (BTC) refused to contain its recent losses throughout January 22nd, when expectations for a trip to $33,000 and below seemed to be a reality.
Hourly BTC/USD light chart (Bit Mark). Source: TradingView.
Open interest “still not empty”
Data from Cointelegraph Markets Pro and TradingView follows the price of BTC/USD, which fell by $35,000 in the first half of Saturday.
With multiple silver caps available for the bulls, the low trading volume over the weekend was about to trigger some classic unsustainable moves after Bitcoin lost support at $40,000 on Friday.
While some, including El Salvador, benefited from the new lows, others expressed concern that despite the drop, there was still pressure on the bulls.
Trader and analyst William Clemente, one of the many market participants who noted that derivatives traders were still trying to fight the trend, concluded, “The wrong part is that the open interest has not emptied yet.”
“After all this carnage and the sheer state of finance panic somehow not being giga-negative, the feet haven’t caught on and the OI has gone down since then. Fun times. Too.
Funding price chart for Bitcoin futures (Binance). Source: Coinglass.
The RSI will drop to its lowest for COVID in March 2020.
The source of some relief was the Bitcoin Relative Strength Index (RSI) for the day, which fell to its lowest level since March 2020.
Related: Here are 3 ways to use the Relative Strength Index (RSI) as a sell signal.
At the time, BTC/USD collapsed to $3,600 before settling on a comeback that could extend into the next year.
Saturday’s daily RSI was only 20, well below the traditional oversold territory.
BTC/USD 1-day chart (bit tick) with RSI. Source: TradingView.
“Slightly more reliable than bitcoin alone -> total market capitalization at the next support level while the daily RSI reaches its lowest level since March 2020,” commented Mikael van de Poppe, a Cointelegraph contributor.
“Stock sentiment is also at its lowest level since March 2020. And that’s it.”
By the end of the week, stock markets took a hit, with tech stocks, especially in the firing line, and cryptocurrencies showing a degree of positive correlation once again.