Topped or bottomed? Traders at odds over whether Bitcoin will keep rising
Bitcoin (BTC) touched $44,000 a second time on Jan. 12 amid increasing divergence of opinion about whether the price bottom is "in."
BTC/USD 1-hour candle chart (Bitstamp). Source: TradingViewData from Cointelegraph Markets Pro and TradingView showed the $44,000 mark acting as local resistance Thursday, following forecasts that $46,000 could soon return.
Bitcoin stayed broadly higher overnight following the previous day's U.S. inflation data, but for some, now was not the time to become overly confident.
"BTC starting to feel a little toppy (local), although asks are diffused through some key resistance levels," Twitter account Material Indicators commented as part of a recent update.
"Some bitcoin bulls may show up to clear a few levels, but the whole herd is going to have to show up to clear them all."Suggesting a good opportunity to "de-risk," Material Indicators highlighted order book flux which on Wednesday had formed the focus of a graver warning about a possible incoming crash.
By contrast, others believed that a price "squeeze" may ultimately be to the upside and punish latecomer short traders.
Observing perp funding going increasingly negative as price grinds higher, it appears that the real liquidation wave may be on the upside https://t.co/ml8h5t0Skg
— Zhu Su (@zhusu) January 12, 2022Popular trader Crypto Ed meanwhile began to show optimism over significantly lower levels being gone for good.
Uploading a predictive chart snapshot, he argued that should BTC/USD grind higher on the day, the stage would be set for a higher low construction as part of a more solid recovery.
Good Morning all!
Tnx for giving me some time to have a twitter break, but I'm back to tell you that my feeling about "bottom is in" is getting stronger when seeing the #BTC chart.
Want to see more confirmation, but if we do get that 5th leg today, I'm getting excited! pic.twitter.com/yW07BSdrYC
— Crypto_Ed_NL (@Crypto_Ed_NL) January 13, 2022How long can the relief last?
A brief look at funding rates across exchanges revealed only a slight change overnight, with neutral to negative values dominating.
Related: Traders say Bitcoin run to $44K may be a relief bounce, citing a repeat of December’s ‘nuke’
Such behavior runs in contrast to recent weeks, in which a declining spot price was met by positive funding.
Bitcoin funding rates chart. Source: CoinglassAt the time of writing, BTC/USD continued to attempt a breakout of the $44,000 zone, buyers preventing each drawdown.