2 key metrics suggest Bitcoin price wont be pinned below $33K for long

Wednesday 27 January 2021, 8:08 AM AEST - 4 weeks ago

Over the last 48 hours, Bitcoin (BTC) price climbed from $31,000 to $34,800 before reversing course and dropping the majority of these gains. While this $3,800 shift to the downside might not seem significant, the 12% oscillation liquidated $660 million worth of futures contracts.

While its unlikely that there will ever be a definitive answer behind the move, on Jan. 25, President Joe Biden voiced his willingness to lower the $1.9 trillion stimulus package. This might have reduced incentives for those buying BTC as an inflation protection or a hedge against U.S. dollar devaluation versus leading global currencies.

d6bb6c83-90bc-401a-8a20-4d2ae281c37d.pngBTC/USD 4-hour chart. Source: TradingView

Shorter-term charts might not reflect Bitcoins bullishness, but several derivatives indicators and the top traders' flow leaves no room for expecting sub-$30,000 prices.

Bitcoin has been testing the $30,800 support, but bulls have shown aggressive buying activity below that level. Not surprisingly, both MicroStrategy and Marathon Patent Group have recently announced sizeable acquisitions.

Data shows that the top traders at OKEx have been heavily buying the dip and the futures contracts premium does not reflect excessive leverage from buyers.

One should keep in mind that the Jan. 29 futures' expiry will extinguish $4.9 billion worth of futures contracts, or 47% of the total $10.5 billion open interest.

Derivatives exchanges BTC futures open interest in USD. Source: Bybt.com

Albeit initially worrisome, a large part of those contracts are usually rolled over. These include $1.53 billion at OKEx, $875 million at CME and $840 million at Binance.

Traders who are currently long can buy a longer-term contract while si ...

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