Originally published on: December 06, 2024
In a rollercoaster ride for Bitcoin, the leading cryptocurrency saw a flash crash that dipped down to $90,500 on December 5, only to swiftly recover above $100,000 shortly after.
Despite the intense 14% drop from its recent all-time high of $104,600, Bitcoin has shown resilience by rallying 4.57% on the daily chart. The cryptocurrency has managed to maintain a bullish position above all exponential moving average (EMA) levels on the four-hour chart.
During the sudden decline, Bitcoin’s high and low values were recorded at $99,105 and $90,500, respectively, leading to over $400 million in liquidations, marking the largest event since 2021.
A positive outcome from this event was the reset of BTC’s open interest-weighted funding rate, which plummeted from 0.09% on December 4 to 0.01% on December 6.
Bitcoin futures analyst Byzantine General noted the funding rate drop and described Bitcoin’s current position as “really good.” They highlighted the decrease in the funding rate, aggregate open interest dropping to $95,000, and a decline in spot premium as indicators of a somewhat deleveraged futures market compared to previous days.
After the price volatility on December 5, a bearish spinning top candlestick pattern formed on Bitcoin’s one-day chart, indicating a period of indecisiveness between buyers and sellers.
Notably, similar spinning top patterns have emerged at crucial milestones for Bitcoin in the past, such as crossing $1,000 and $10,000. This pattern, according to Charles Edwards of Capriole Fund, is normal for BTC and usually precedes bullish market tendencies.
Looking ahead, based on Fibonacci extensions, the immediate target for Bitcoin is set at $115,000, representing a 15% increase from the current level. With the relative strength index (RSI) showing potential for an aggressive breakout, prices could surge up to $124,500, marking a significant leap from the recent swing low of $90,500.
As Bitcoin continues its journey towards new highs, market expectations remain optimistic for further bullish momentum.
With a slew of new triggers and catalysts on the horizon, the cryptocurrency landscape is ripe for further excitement and potential gains in the coming days. Keep a close eye on the market for more updates and insights on this ever-evolving sector.