Analyst Predicts A Mega Bull Run If Bitcoin Breaks $36,000
2023年10月31日 - 12:00PM
NEWSBTC
Crypto and Bitcoin traders should prepare for another sharp leg up,
especially if the coin breaks above the $35,750 to $36,000
resistance wall this week. According to an X user, Alex Thorn,
the Head of Firmwide Research, the $250 zone between those prices
is a crucial liquidation barrier that derivatives traders closely
watch. If bulls have the upper hand and push above the upper limit
of the belt, prices could rip higher this week primarily because of
the resulting demand in the spot market. Is Bitcoin Ready For
Another Rally? Thorn compares the current setup evolving in the
Bitcoin chart to the events last week, which saw the coin explode.
At spot rates, Bitcoin is stable but trending around 2023 highs,
with buyers expecting more gains as market sentiment improves.
Though most users are looking at the United States Securities and
Exchange Commission (SEC) and the potential approval of a spot
Bitcoin Exchange-Traded Fund (ETF) as a trigger for the next leg
up, Thorn is closely tracking events in the Bitcoin trading scene,
specifically, the derivatives market. In the analyst’s assessment,
options traders will be the primary drivers of the next bull
run. Related Reading: Artificial Intelligence Crypto Boom:
What’s Behind The Double-Digit Surge? Why $36,000 Is A Key Price
Level To Watch Based on the analyst’s assessment, once Bitcoin
breaks the $35,750 to $36,000 zone, “options dealers will need to
buy $20m in spot BTC for every 1% upside move,” driving prices
higher. The reason dealers have to buy or sell Bitcoin at the spot
market depends on whether they are “short or long gamma.” The
objective, when this happens, is to stay “delta neutral.” The
decision to buy at the spot market comes after a “gamma squeeze,”
which, as Thorn notes, lifted prices last week. Technically, a
gamma squeeze arises when there is a spike in call (or buy) options
being purchased, forcing options dealers, most of whom are market
makers, to buy the underlying asset, in this case, Bitcoin, to
hedge their positions and stay “delta neutral.” Going by trends and
the current setup, especially in the daily chart, this could
happen. Related Reading: DOGE Breaks Free From Multi-year
Descending Order, What’s Next? Looking at other metrics, Thorn
noticed a divergence in supply held by speculators and long-term
holders, opining that on-chain liquidity could be dwindling.
However, on the bright side, the Z-Score ratio of market price to
realized price shows that Bitcoin is in a “healthy” position. As of
October 30, Bitcoin is within a bullish breakout formation, with
traders bullish. Whether the uptrend remains depends on whether
buyers follow through, pushing the coin above recent highs, away
from the breakout level at around $32,000. Feature image from
Canva, chart from TradingView
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