Bitcoin prices surged above $ 60,000 for the first time in two weeks, increasing the prospect of a cryptocurrency surge in the new quarter after closing the previous quarter by nearly 100 percent.
Still, analyst Robbie Liu noted that the recent Bitcoin rally was due to “overheated retail promotions”. The OKEx researcher highlighted rising premiums for the quarterly contract BTCUSD0625, which rose from $ 3,000, or 5.7 percent, last Friday to the current $ 5,200, or 8.7 percent. The level was almost the same last month when Bitcoin hit an all-time high above $ 61,000.
“After the rise in premiums, the funding rates for perpetual swaps that started to rise in the middle of the week are now over 0.15% per eight hours,” said Liu. “These numbers are certainly entering a more dangerous area.”
“Unless the price breaks up in a short period of time, traders trying to track the rally with high leverage will have to close out their positions, putting pressure on the price,” he added.
Quarterly Bitcoin futures price, spot index price and base difference. Source: OKEx More evidence of an impending downward correction came from Bitcoin’s margin-lending ratio.
In retrospect, it is spot market trading data that shows the relationship between users who borrow USDT and BTC borrowers in USDT value over a period of time. This week it fell from 9.5 to 8.2, indicating that leveraged spot traders are starting to reduce their positions after securing profits.
“The currently overheated bullish sentiment is already evident in several indicators from OKEx trading data,” added Liu. “Unless price can break the psychological $ 60,000 mark quickly, it is likely that the RSI indicator on the four-hour chart is showing a bearish divergence that will result in a correction.”
Bitcoin market outlook
The recent surge in the Bitcoin market pointed to stabilization after a strong upward rally earlier this week.
Traders were grappling with the prospect of Joe Biden’s new $ 2 trillion government spending plan. They were also guided by PayPal’s decision to add a crypto checkout option on its legacy platform and Morgan Stanley’s SEC filings, which show the investment banking giant has 25 percent of the portfolios of its institutional funds for Bitcoin Trust could provide Bitcoin futures and grayscale with cash settlement.
Bitcoin corrects lower after testing $ 60,000 as a resistance. Source: BTCUSD on TradingView.com “The ~ $ 57,500 area turned down BTC in February, but it looks like BTC turned that exact level into support a few days ago,” said a pseudonymous market analyst. “Now it’s a matter of moving on from here. And we’re seeing some follow-up today.”
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