Bitcoin’s trading range: Since the massive drop on May 19, Bitcoin has been stuck in a range between $31,000 and $40,000.
If Bitcoin breaks about $41,000, it could be off and running.
Selling volume is diminishing: The only reason investors move bitcoins to an exchange is to sell them, so we can gain important insight looking at the total number of coins transferred to exchanges.
This indicated a lot of selling pressure, and the price action reflected this.
At the beginning of this week, only about 40,000 coins were moved onto exchanges — about half as much as the big selloff days.
Fewer leveraged liquidations: We see a strong link between the massive selloffs on May 12 and 19 to high open interest in futures and leverage.
But over the last 21 days, forced sales in the futures markets have stabilized, and total liquidations have dropped to low levels.
Once Bitcoin breaks out from its trading range, futures open interest will probably increase rapidly.
Money on the sidelines: With stocks, analysts watch the amount of cash in money market accounts because that is basically money on the “sidelines” ready to be invested.
When the SSR is low, there are more stablecoins relative to Bitcoin … meaning more Bitcoin “buying power.” That’s exactly what we have right now with the SSR at its lowest levels of 2021.
Fear and greed: All investing markets act emotionally, and that’s especially true with cryptos.
Extreme fear means investors are overly worried and willing to part with their cryptos at really low prices — which means buying opportunities.
The Byte Fear and Greed Index takes six measurements into account — volatility, market momentum, social media, surveys, market capitalization dominance and trends.
The transformation and trend are too powerful, which means these unusually low prices are a great buying opportunity in bitcoin and the strongest altcoins that we expect to surge a lot higher over time.