After an overnight correction that wiped out any previous snap gains, Bitcoin (BTC), traded below $65,000 on November 11.
BTC/USD 1-hour candle charts (Bitstamp). Source: TradingView
Speculators have “no free lunch”
Data from TradingView and Cointelegraph Markets Pro showed that BTC/USD recovered after briefly falling below $63,000 in fresh volatility.
Due to the US inflation reaching its highest level in 30 years, the pair rose sharply. This was combined with market reactions and derivatives market reactions that led to uncertain price action.
Sixteen thousand dollars is the new record high. Some were afraid, but others took the opportunity to laugh at the weak.
“Why did Bitcoin pullback from 68k?” Analyst Dylan LeClair shared the chart from Glassnode and explained that there was a significant increase in BTC margined forwards open interest today (traders taking long BTC with BTC collateral).
“No free lunch — these traders have to be shaken out.”
Annotated chart of Bitcoin futures open interest Source: Dylan LeClair/Twitter
William Clemente, a fellow analyst, pointed out that the Taproot soft fork is a strong reason to be bullish on short-term price movements.
Taproot will introduce a variety of protocol improvements to Bitcoin. These are not comparable to any changes made since the introduction Segregated Witness (SegWit), which is a transaction technology that allows for transactions to be segregated.
People are panicking as we’re only days away from Bitcoins first major upgrade (Taproot), since Segwit in 2017.
— Will Clemente (@WClementeIII) November 10, 2021
The derivatives funding rates proved that there had been a shakeout, and returned to neutral territory at 0.01% on all exchanges.
Ether avoids deeper altcoin retracement
Altcoins experienced the heat of Bitcoin reversed in classic fashion, eliminating what had been previously outperforming BTC/USD.
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Ether (ETH), which was down 0.6%, was the best performer on the day. It is still just a stone’s throw away from its all-time highs.
BITSTAMP: ETH/USD 1-hour candle charts Source: TradingView
Others did slightly worse with 4% daily losses common among top 10 cryptocurrencies based on market capitalization.
Michael van de Poppe, a Cointelegraph contributor, concluded his YouTube update with the following: “Crucial right now: Bitcoin.”
“Where will we break through?” If we can break through the $67,000 mark, I believe we will continue the bull market. We are ready to hit new all-time highs.