Bitcoin (BTC) reached a new full-time high of $ 25,945 on Binance on December 26, just a day after reaching a full-time high at Christmas.
BTC / USDT candlestick chart every hour (Binance). Source: TradingView.com
There are several general reasons why Bitcoin has risen, such as the increase in institutional demand for BTC. But for the current intraday rally, the oversold Binance Futures is the main catalyst.
$ 25,000 BTC is now higher than the price of the Inventory Flow model
Before the sudden rally, many traders were selling bitcoin on most major futures exchanges. This eventually led to the contraction of shorts that short sellers sold near the previous all-time high. After the record was broken, BTC began to rise rapidly as the price of Bitcoin entered the price range.
More than $ 131 million in bitcoin futures contracts have been settled in the last 24 hours, according to Bybt.com. As long as the number of sellers continues to grow in the derivatives market, the probability of further card sales in the near future remains high.
Furthermore, the current rally means that Bitcoin is now above the midline of the popular stock flow model, which predicts a target of $ 100,000 by December 2021.
What’s next for bitcoin?
Meanwhile, traders and technical analysts are generally positive about Bitcoin price dynamics. Popular trader Philip Swift, for example, notes that the number of big sellers has actually decreased during the current rally.
“For the first time in this fantastic period, the major players have made more than 1,000 barrels per second of their portfolios,” Swift explained. “We see that the number of portfolios over 1000 Btu has decreased rapidly in the last week or so. While we see that portfolios of 1-10 BTC (bulk retail) have continued to grow steadily in recent weeks. ”
A quick analysis shows that there are many shops that come into the Christmas holidays. Most likely because: a) Learned about BTC from family / friends during the holidays. A new ATH is now being created. B) Plus some potential jump to end XRP / other options.
Traders are also becoming increasingly skeptical about selling bitcoins, as they have not yet reached the top. Until the BTC peaks, the chances of a significant short squeeze that will trigger a short-term rally remain high.
Furthermore, Michael Van de Pope, an analyst at Cointelegraph Markets, said that the next momentum could force Bitcoin to cross $ 40,000. He wrote:
“Bitcoin breaks higher as it approaches the second Fibonacci point of interest around $ 25,800. The higher we go, the higher the next momentum. If $ 25,800 is a temporary high, the next press can yield $ 40,000 in BTC. ”
Pay attention to institutional demand
The next logical peak for bitcoin is likely when institutional bitcoin purchases slow down.
The most practical way to measure organizations’ emotions is to assess the size of the CME Bitcoin futures market and BTC flows in shades of gray.
Until these two institutional investment cars see a significant decline in demand and volume, the chances of a deep correction in Bitcoin remain low.