Why Closing Out The Year Below $50,000 Could Be Bad For Bitcoin

A number of predictions had put the price of bitcoin at $100,000 by the top of the yr and though there are nonetheless some weeks left to go, it doesn’t appear to be these predictions will come to cross. Bitcoin has nevertheless maintained a bullish pattern regardless of price crashes and large liquidations rocking the digital asset in current instances.

Since analysts, and the crypto market normally, has been so targeted on the bullish way forward for the asset, there has not been a lot consideration paid to a low for the yr. As the top of 2021 rolls round, you will need to not solely have a look at the bullish end-of-year predictions but additionally how the cryptocurrency may be affected relying on the price bitcoin closes at.

Related Reading | Bitcoin Open Interest Takes Second Largest Dump Of 2021

Crypto analyst Justin Bennett addresses this in his latest issue of the weekly newsletter. Bennett maps out the outlook for the digital asset, in addition to the implications of bitcoin closing out the yr under $50,000.

Options Contracts Becoming Worthless

Some of the bitcoin choices contracts are set to run out on the finish of the yr and the profitability of those choices contracts rely tremendously on what price BTC is after they expire. Since the crash, bitcoin has struggled to keep up its worth above $50,000 and this has not been good for the choices contracts. Bennett notes {that a} shut under $50,000 would see all of those contracts expire nugatory, taking part in into what he known as the “max pain theory”.

The crypto analyst shouldn’t be significantly assured within the digital asset’s capacity to complete the yr above $50,000. He expressed that he expects the consolidation in bigger cap cryptocurrencies to proceed by the final month of the yr.

Bennett nevertheless notes that there’s a big selection for bitcoin as a result of December 4th candle. This implies that wherever between $42,000 and $53,000 is feasible going ahead, offering an enormous margin for the digital asset.

Bitcoin price chart from

BTC price continues downtrend | Source: BTCUSD on

Bitcoin Volume Is Concerning

Bennett additionally factors to the dearth of quantity within the cryptocurrency. One factor is to begin a rally or a breakout, however the different factor is to get sufficient quantity to match that breakout. Otherwise, a rally wouldn’t achieve success.

Related Reading | Number Of Bitcoin Lightning Network Nodes Jumps 23% In Three Months

“If we’re to see Bitcoin and the rest of the crypto market breakout later this month or even January, we need to see volume to match the price increase,” mentioned Bennett. “Without volume, any rally or even breakout is more likely to fail.”

As bitcoin continues to consolidate following a $53,000 check, the market is quietly ready for extra institutional cash to pump into the market. Currently, Bennett has put the bitcoin key help at $49,000. “Below that is the April trend line near $46,000,” Bennett notes.

Featured picture from Bitcoin News, chart from

Related posts

Apple Co-Founder Steve Wozniak ‘Feels’ Bitcoin Will Be Worth $100,000

Crypto Advisor

XRP Price Surges – Is Ripple Winning The Fight Against SEC?

Crypto Advisor

Ethereum Surges Above $4K, Why Dips Could Turn Attractive

Crypto Advisor

Leave a Comment