Bitcoin is struggling! In recent weeks, many analysts have predicted a rise in power for the bitcoin queen of cryptos. But since the beginning of the year, the opposite situation has been observed. The asset has indeed dropped several times to currently hover around just 40,000 dollars. For some, this is just the beginning of a dark period.
The downtrend of the queen of cryptos continues
Is the bitcoin (BTC) crash just beginning? The question plagues the minds in view of the current trends of the queen of cryptos. And it is fundamentally legitimate given the dynamic of the flagship crypto throughout this day in particular.
Already having fallen below the 41,000 dollars mark early this Monday 22nd January, the crypto has continued its collapse since. It is currently valued at 39,886 dollars, which is a decrease of 0.95% in the past hour.
All this suggests that the correction the crypto is undergoing is potentially not at its end yet. This scenario seems quite normal when one is familiar with the historical volatility that characterizes bitcoin (BTC).
Moreover, the current situation of the asset reminds of projections recently formulated by crypto industry analysts. While BTC was teasing the 47,000 dollars mark, Jim Cramer, the host of CNBC’s Mad Money show, suggested that the asset has peaked. An idea somewhat supported by Arthur Hayes who announced a 40% drop in the price of BTC. We are not very far off.
Bitcoin’s price is in a downtrend, dipping below $41,250 support. Bearish signs indicate potential decline below $40,000. Technicals show resistance at $41,320, with support levels at $40,500 and $40,000. Traders cautious as BTC faces risk of more losses.— BlockVoyager (@BlockVoyagerAIO) January 22, 2024
Is bitcoin (BTC) in a critical support zone?
In the current circumstances, the downward movement of BTC has called into question the 41,000 dollars support zone. As the flagship crypto has dropped below the 40,000 dollars mark, a collapse to 38,000 dollars is feared.
Anyway, data on options reveals that bitcoin (BTC) is in a pivotal situation, characterized by call options prevailing over put options. This suggests operators’ interest for more call options.
However, caution is advised due to uncertainties related to the expiration dates and the potential overbought phase signaled by the put-call ratio (PCR). It is an indicator that compares the number of call option contracts with the number of put option contracts.
If the ratio suggests an abundance of call options relative to put options, it could indicate an overbought market. This could be concerning for investors. The future evolution of bitcoin (BTC) price must be followed with utmost vigilance, even if some analysts remain convinced that the situation will reverse.