After peaking at $ 33,350 earlier in the day, Bitcoin fell to $ 30,000 on leading exchanges just minutes ago. But despite this rapid sell-off, buyers have stepped in to buy the dip.
BTC is now trading at $ 31,300 and is up more than 7.5% in the last 24 hours. Altcoins, such as Ethereum, also remain green despite the decline.
Many attribute this price volatility to the fact that it is a weekend. While BTC was largely a retail-focused market, institutions have started to trade it, often leading to more liquidity and volumes on weekdays rather than weekends.
Bitcoin Blow-Off Top
Some have argued that Bitcoin may be undergoing a blow-off peak after gaining nearly $ 4,000 in one day.
A trader shared this trade below, noting that he entered a short position in Bitcoin near the highs due to overbought indicators. As the chart below shows, certain indicators showed that Bitcoin’s price action was clearly overheating and probably took time to reset.
I just entered a minor short.
Will add more when I see a nice comment.
– Byzantine General (@ByzGeneral) January 2, 2021
However, what gives these traders a break is the rapid recovery that BTC just saw.
While Bitcoin was trading at $ 30,000 just minutes ago, it is now trading at $ 31,300. The rapid recovery of the cryptocurrency’s price action may show that there is a latent bid for the cryptocurrency that will appear with every dip.
This buying pressure is likely institutional. For example, at the end of December, Grayscale added nearly 13,000 BTC to its holdings to explain institutional capital inflows.
There is also news that companies like SkyBridge Capital are buying tens of millions of dollars worth of BTC.
Related reading: 3 Bitcoin On-Chain Trends Show A Macro Bull Market Is Growing
Featured Image from Unsplash Chart from TradingView.com Price Tags: xbtusd, btcusd, btcusdt Bitcoin Plunges 8% to $30,500 Amid Rapid Weekend Price Action