First Mover: Bitcoin Eyes Bull Revival as Dip Below $54K Wipes Out Millions More in Leverage

March 16, 2021

Everything you need to make sense of the crypto markets and beyond

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By the CoinDesk Markets Team

Edited by Lawrence Lewitinn

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Bitcoin (BTC)

-0.8% $55,984

Ether (ETH)

+1.2% $1,800

(Price data as of Mar. 16 @11:00 UTC)

Good morning. Here's what we're writing about:

Check out the CoinDesk TV show "First Mover," hosted by Christine Lee, Lawrence Lewitinn and Emily Parker, at 9 a.m. U.S. Eastern time. Today the show will feature guests:

Kris Marszalek, CEO of Crypto.com

MARKET MOVES by OMKAR GODBOLE

Bitcoin Eyes Bull Revival as Dip Below $54K Wipes Out Millions More in Leverage

Bitcoin has erased the losses from its latest price dip and could soon see more gains as normalcy returns to the derivatives market.

Having hit a low of $53,350 during the Asian hours the cryptocurrency is trading 1% higher on the day near $56,200 at press time, according to CoinDesk 20 data. Selling pressure faded near the widely tracked monthly volume-weighted average price (VWAP) of $53,000.

The market now looks ready for a fresh move higher, as the bitcoin perpetual futures funding rate – the cost of holding long positions calculated every eight hours – has dropped sharply from 0.124% to 0.08% after excess bullish leverage was wiped out by the cryptocurrency’s pullbacks Monday and Tuesday.

Bitcoin's average perpetuals funding rate (Source: Glassnode)

Long trades worth $1.16 billion were liquidated on Monday, the most since Feb. 22, according to data provider Coinalyze. And with today’s drop, another $368 million-worth were liquidated by major exchanges.

With the lower funding rate, a more sustained move toward record highs could be seen – more so, as global stocks continue to rally with risk sentiment being supported by fundamentals, according to a tweet from Holger Zschaepitz, a markets commentator and economics author.

Further, many U.S. citizens scheduled to receive $1,400 stimulus checks this week could invest part of the cash received into bitcoin, boosting its price. As per a Mizuho Securities survey, nearly $40 billion of the latest round of stimulus checks could be spent on bitcoin and stock purchases.

Technical charts are also suggesting scope for a price bounce.

Bitcoin's hourly chart (TradingView)

The 14-hour relative strength index (RSI), a momentum indicator, formed a higher low early today, decoupling from the downtrend in prices. That “bullish divergence” indicates the pullback has run out of steam.

That said, fresh chart-driven selling may be seen if the cryptocurrency drops below the monthly VWAP support at $53,000.

--Omkar Godbole

Read the original story here:

Bitcoin Eyes Bull Revival as Dip Below $54K Wipes Out Millions More in Leverage

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TECHNICIAN'S TAKE by DAMANICK DANTES

Bitcoin Holds Short-Term Support at $54K, Resistance Seen at $58K

Bitcoin (BTC) buyers defended short-term support around $54,000 but will face heavy resistance around $58,000. On the 4-hour chart, bitcoin is now the most oversold since the February 28 low around $42,900, which preceded a near 40% price rally.

Chart shows trend support on the 4-hour chart, with an oversold RSI (Source: TradingView)

--Damanick Dantes

Original story found here:

Bitcoin Holds Short-Term Support at $54K, Resistance Seen at $58K: Technical Analysis

BIGGEST MOVERS

These are the biggest movers in the CoinDesk 20 over the past 24 hours:

Gainers:

XRP (XRP): +9.3%

EOS (XRP): +5.2%

Losers:

The CoinDesk 20 filters from the larger universe of thousands of cryptocurrencies and digital assets to define a core group of 20. These assets constitute roughly 99% of the market by volume at eight of the largest and most trustworthy exchanges.

ICYMI

In case you missed it, here is yesterday's episode of First Mover:

Bitcoin skeptic turned believer Kevin O'Leary says he has a solution to bitcoin provenance concerns: invest in environmentally responsible BTC mining in preferred countries. Here's how he plans to capitalize on this idea. Plus, Senior Reporter Omkar Godbole with crypto markets analysis, and a Mt. Gox update from a former plaintiff, U.S. securities attorney Jonathan Dunsmoor.

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Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments.

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