{"id":350556,"date":"2021-10-09T16:36:53","date_gmt":"2021-10-09T13:36:53","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/what-bitcoin-correction-btc-price-holds-55k-despite-several-bearish-indicators\/"},"modified":"2021-10-09T16:36:53","modified_gmt":"2021-10-09T13:36:53","slug":"what-bitcoin-correction-btc-price-holds-55k-despite-several-bearish-indicators","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/what-bitcoin-correction-btc-price-holds-55k-despite-several-bearish-indicators\/","title":{"rendered":"# What Bitcoin correction? BTC price holds $55K despite several bearish indicators"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a37a1e252255\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a37a1e252255\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/what-bitcoin-correction-btc-price-holds-55k-despite-several-bearish-indicators\/#%E2%80%9CGreed%E2%80%9D_mode_can_last_for_weeks_or_months\" >&#8220;Greed&#8221; mode can last for weeks or months<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/what-bitcoin-correction-btc-price-holds-55k-despite-several-bearish-indicators\/#Bollinger_Bands_a_good_short-term_indicator\" >Bollinger Bands, a good short-term indicator<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/what-bitcoin-correction-btc-price-holds-55k-despite-several-bearish-indicators\/#The_funding_rate_has_been_neutral\" >The funding rate has been neutral<\/a><\/li><\/ul><\/nav><\/div>\n<p>&#8220;<strong># What Bitcoin correction? BTC price holds $55K despite several bearish indicators  <\/strong>&#8221;<\/p>\n<div class=\"post-content\" data-v-128018ef>Experienced analysts and <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">media<\/a> outlets including Cointelegraph recently highlighted some indicators suggesting that the Bitcoin (BTC) price rally could be overextended. <\/p>\n<p>Those bearish views include one from Bollinger bands creator John Bollinger, suggesting traders use a trailing stop, as signs of a \u201ctop\u201d were building up.<\/p>\n<p>However, it is worth noting that Bollinger Bands and the Fear and Greed indicator are backward-looking metrics. Therefore, those will usually flash overbought levels whenever there\u2019s a 30% weekly rally, such as the most recent one.<\/p>\n<p>As crypto analyst TechDev_52 correctly questioned, there\u2019s no way to know whether we\u2019re entering a large potential correction or a rally continuation.<\/p>\n<blockquote class=\"twitter-tweet\">\n<p lang=\"en\" dir=\"ltr\">Now you know why they call it a bear \u201ctrap\u201d. It\u2019s damn convincing.<\/p>\n<p>How do you know the \u201ctrap\u201d from the \u201cpeak\u201d? One\u2019s round the other\u2019s pointy.<\/p>\n<p>Which does this look like to you? <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/search?q=%24BTC&amp;src=ctag&amp;ref_src=twsrc%5Etfw\">$BTC<\/a> <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/t.co\/aumWqaMsut\">pic.twitter.com\/aumWqaMsut<\/a><\/p>\n<p>\u2014 TechDev (@TechDev_52) <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/TechDev_52\/status\/1394019211849109506?ref_src=twsrc%5Etfw\">May 16, 2021<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>For example, popular YouTuber and trader Nebraskangooner, shows that the recent $56,000 top could have been the upper range of a bullish channel that has guided Bitcoin since late July. <\/p>\n<blockquote class=\"twitter-tweet\">\n<p lang=\"en\" dir=\"ltr\"><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/hashtag\/Bitcoin?src=hash&amp;ref_src=twsrc%5Etfw\">#Bitcoin<\/a><\/p>\n<p>OBV perking up but still hasn&#8217;t quite broken out yet.<\/p>\n<p>Hitting the top of the channel.<\/p>\n<p>Would love to see bullish consolidation at the range high leading to an OBV breakout w\/ price breakout for mega bullish continuation. <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/t.co\/btm5aW7WTW\">https:\/\/t.co\/btm5aW7WTW<\/a> <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/t.co\/kPqwOSMgE1\">pic.twitter.com\/kPqwOSMgE1<\/a><\/p>\n<p>\u2014 NebraskanGooner (@nebraskangooner) <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/nebraskangooner\/status\/1445755728153616403?ref_src=twsrc%5Etfw\">October 6, 2021<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<h2><span class=\"ez-toc-section\" id=\"%E2%80%9CGreed%E2%80%9D_mode_can_last_for_weeks_or_months\"><\/span>&#8220;Greed&#8221; mode can last for weeks or months<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Going back to the Fear and Greed indicator, below are some examples that such a metric can sustain overbought levels for longer than three or four weeks.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-10\/4c795801-b458-4c7f-b0dc-e867f430a967.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin \u2018Fear &amp; Greed\u2019 index (above) and Bitcoin price at Bitstamp (below). Source: btctools.io, TradingView<\/em><\/figcaption><\/figure>\n<p>Notice how between Jan. 29 to Feb. 26, the Bitcoin Fear and Greed indicator remained above 65, indicating traders were overconfident. <\/p>\n<p>The metric uses trading volume, futures open interest, social metrics, and search data to calculate how hyped the market is. <\/p>\n<p>Thus, it took four weeks before a significant Bitcoin price correction took place after the warning sign popped up. Whoever sold in the initial days after the indicator flashes missed the 70% rally that followed.<\/p>\n<p>A similar pattern h<a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>ened between July 23 and Aug. 25, while the Bitcoin price continued to rally. Yes, a correction will always come at some point, but how many weeks or months later? <\/p>\n<h2><span class=\"ez-toc-section\" id=\"Bollinger_Bands_a_good_short-term_indicator\"><\/span>Bollinger Bands, a good short-term indicator<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>John Bollinger is an experienced and well-respected trader, but his indicator is the moving average plus some deviation based on the current volatility. In short, a 30% weekly move will be outside this range most of the time, considering Bitcoin\u2019s usual 4.5% daily volatility. <\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-10\/8c4fe551-2224-4100-a3c3-45aa3a381c8d.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin price at Coinbase using 20-day Bolling Bands. Source: TradingView<\/em><\/figcaption><\/figure>\n<p>Certainly, a minor correction tends to follow through when Bitcoin breaks the upper Bollinger band, but that has absolutely zero correlation to the price some two to four weeks ahead.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_funding_rate_has_been_neutral\"><\/span>The funding rate has been neutral<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Lastly, one should analyze the funding rate, a fee charged by derivatives\u2019 exchanges to balance the risk between longs (buyers) and shorts (sellers) as their leverage varies. Sure enough, when a buying spree takes place, the indicator goes up. <\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2021-10\/2ef8affe-c718-4c83-8b8d-4d19b1a36d26.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin 8-hour perpetual futures funding rate. Source: Bybt.com<\/em><\/figcaption><\/figure>\n<p>The current 0.04% average rate per 8-hour, or 0.8% per week, is nothing out of the ordinary. Back in December 2020, for example, it stayed above 1.5% per week for a whole month, and then again in February 2021. <\/p>\n<p>Similar to the Fear and Greed indicator, this metric shows that buyers are getting overconfident as it surpasses 0.10% per 8-hour, but not necessarily an alarming level.<\/p>\n<p>As long as buyers are confident that the rally will continue, paying a 1.5% or even 3% weekly fee won\u2019t force them to close the leverage longs. For example, if a Bitcoin supply shortage on exchanges has caused the recent rally to $56,000 as holders accumulate, there might be room to $80,000 or higher.<\/p>\n<p>However, a crash can be expected if some bearish events occur in the near future, such as\u00a0exchange-traded fund\u00a0requests being denied or some draconian U.S. ban on stablecoins. In such an event, Bitcoin will not breach the all-time high, and those backward-looking metrics will finally \u201cwork.\u201d<\/p>\n<p><em>The views and opinions expressed here are solely those of the <\/em><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/noshitcoins\"><em>author<\/em><\/a><em> and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.<\/em><\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/what-bitcoin-correction-btc-price-holds-55k-despite-several-bearish-indicators\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8220;# What Bitcoin correction? BTC price holds $55K despite several bearish indicators &#8221; Experienced analysts and media outlets including Cointelegraph recently highlighted some indicators suggesting that the Bitcoin (BTC) price rally could be overextended. Those bearish views include one from Bollinger bands creator John Bollinger, suggesting traders use a trailing stop, as signs of a&#8230;<\/p>\n","protected":false},"author":1,"featured_media":350557,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjEtMTAvZWVhZTU1OWEtZmQ5Mi00YWRiLTgxNjEtNWIzOTYxZTlhZDU3LmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74862,74972,74937,75012,75846,74939,73785],"class_list":["post-350556","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin","tag-bitcoin-futures","tag-bitcoin-price","tag-derivatives","tag-futures","tag-market-analysis","tag-markets"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/350556","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=350556"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/350556\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/350557"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=350556"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=350556"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=350556"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}