Autor Cointelegraph By William Suberg

Bitcoin (BTC) refused to stem recent losses during Jan. 22 as predictions of a flight to $33,000 and lower looked increasingly likely to become a reality.BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView.Open interest “still not flushed”Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it fell through $35,000 during the first half of Saturday.With few silver linings available for the bulls, lower weekend volume was poised to deliver some classic erratic moves after Bitcoin lost $40,000 support on Friday.While some, including El Salvador, made the most of the new lower levels, others voiced concern that despite the drop, pressure still remained on bulls.”Crazy part is open interest still hasn’t flushed,” trader and analyst William Clemente summarized, one of many market participants noting that derivatives traders are still attempting to fight the trend.”After all this carnage and absolute state of panic funding somehow isn’t giga negative, futs aren’t backwarded and OI barely went down. Interesting times. And with ‘interesting’ I mean poverty,” popular Twitter account Byzantine General additionally quipped.Bitcoin futures funding rates chart (Binance). Source: Coinglass.RSI sinks towards March 2020 COVID lowsA source of slight relief came in the form of Bitcoin’s relative strength index (RSI) on the day, this dipping to its lowest levels since March 2020.Related: Here’s 3 ways the relative strength index (RSI) can be used as a sell signalAt that time, BTC/USD crashed to $3,600 before staging a comeback that would last well into the following year.Daily RSI stood at just 20 Saturday, already well below even the classic “oversold” zone.BTC/USD 1-day candle chart (Bitstamp) with RSI. Source: TradingView.”A bit more reliable than Bitcoin alone – > total market capitalization is at next level of support, while the daily RSI hits the lowest level since March 2020,” Cointelegraph contributor Michaël van de Poppe commented on the situation. “Equities sentiment is also on the lowest level since March 2020. Says it all.”Equities markets had taken a hit towards the end of the week, with tech stocks particularly in the line of fire and crypto once again showing the extent of its positive correlation.

Bitcoin (BTC) could well continue falling in the short term now that $40,000 support has disappeared, fresh analysis warns.In its latest market update on Friday, trading suite Decentrader analyst Filbfilb raised concerns that the day’s $290 million in liquidations was not enough to avert a fresh tumble.Next stop $33,000 if leverage unwindsAfter reversing at $38,250 overnight, BTC/USD looked decidedly unhealthy at the time of writing, putting in fresh lows prior to the Wall Street open. Cross-crypto liquidations passed $720 million on the day, but for Filbfilb, this is historically a meager tally, and with liquidity likely concentrated below $38,000, the chances of a cascade being triggered are obvious.”Liquidations since the push below $40k have been low so far, virtually not even registering on the chart in the grand scheme of things. At the same time, funding remains relatively flat, meaning the bears are winning against margin traders who are almost all underwater,” he wrote.”We have been talking about the liquidity which likely lies below $38K for some time.”Should spot price begin to unwind leveraged positions there, the next stop for “relief” lies at $33,000. The update continued:”If the $38k level is lost with some increased momentum, we are expecting a liquidation event similar to that of 4th December 2021 and a move towards $33k in the first instance, possibly tagging the 100 Week Moving Average, at c.$31,500, but $33,000k also being a potential level for some relief.”Such an outcome would place Bitcoin on track for a copycat finish to that from July, the month in which it put in a floor just below $30,000 — near its 2021 opening price — before recovering.BTC/USD annotated chart showing liquidity in blue (screenshot). Source: DecentraderDaily close above $40,000 required to usher in reboundMeanwhile, to secure further upside, things would need to change significantly.Related: Crypto liquidations pass $700M as altcoins take a hit from Bitcoin sinking below $40KAn uptick would have to be accompanied by negative funding rates, showing that shorters were in suitable disbelief at the staying power of a rebound. The ratio of long to short positions should also decline in step, Filfilb argued.A daily close above $40,000, he concluded, would go some way to permitting such a scenario.At the time of writing, BTC/USD circled $37,900 as volatility once again increased, data from  Cointelegraph Markets Pro and TradingView showed. BTC/USD 1-minute candle chart (Bitstamp). Source: TradingView

Bitcoin (BTC) may have tanked to six-month lows this week, but under the hood, the network is now verifiably stronger than ever.Data from on-chain monitoring resources including Glassnode and BTC.com confirms that as of Friday, the Bitcoin network difficulty is at a new all-time high.Difficulty passes 26 trillion for the first timeThe difficulty, which expresses how much miners need to work to solve the equations to process transactions on the blockchain, is arguably the most important of fundamental Bitcoin network components.The metric automatically adjusts to increase or decrease mining effort according to miner participation — the more competition among miners, the higher the difficulty.This has the effect of keeping mining stable regardless of factors such as sentiment, price or unintended incidents.After dipping in mid-2021, difficulty took the rest of the year to bounce back, with the latest automated readjustment adding 9.32% to the previous level. With that, it entered unexplored territory above 26 trillion.Commenting on the event, cryptocurrency journalist and commentator Colin Wu noted that the increase is the highest in over half a year, with BTC.com data confirming that late August saw the last adjustment of more than 10%.BTC price dip fails to break miner resolveThe difficulty thus logically followed hash rate higher, this having continually set new record highs last year. Related: Breaking ‘bear market’ in Bitcoin demand will spark next BTC price surge — AnalystsHash rate, an estimate of the processing power dedicated to the blockchain by miners, currently sits at 192 exahashes per second (EH/s), having briefly reached 218 EH/s on Jan. 10, according to MiningPoolStats. Bitcoin hash rate for week beginning Jan. 17 (screenshot). Source: MiningPoolStatsAs Cointelegraph often reports, an old mantra among age-old hodlers is that “price follows hash rate,” this trend nonetheless taking a back seat for many as fundamentals move in the opposite direction to spot price.Growing hash rate thus implies that on longer timeframes, miner optimism over the profitability of their operations remains. Calculations last week revealed their break-even point to lie at around $34,000.

Bitcoin (BTC) stayed lower on Friday after an overnight bout of volatility sent the largest cryptocurrency to six-month lows.BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView$40,000 optimism unwindsData from Cointelegraph Markets Pro and TradingView showed BTC/USD reversing at $38,250 after shedding over $4,000 in hours.Circling $39,000 at the time of writing, traders were reeling from the sudden downside, which came just as BTC had hit multi-day highs, passing $43,000.Liquidations across trading platforms were thus predictably significant. For Bitcoin and altcoins combined, 24-hour position unraveling totaled $725 million, with BTC positions accounting for $292 million.The vast majority of the casualties were long positions, a sign that the area around $40,000 had attracted considerable faith as a solid support line.Crypto liquidations chart. Source: CoinglassAs Cointelegraph reported, Friday’s options expiry, involving the open interest of nearly $600 million, was considered the main culprit for sparking the volatility. By contrast, outside triggers such as Russia’s proposed blanket ban on crypto trading and mining appeared to have little to no impact.“$42.4-42.7K couldn’t continue to hold for Bitcoin, so a nuke towards the other side of the region and, most likely, continuation towards even further downwards momentum and lower lows – > happened,” Cointelegraph contributor Michaël van de Poppe explained.The move had been long in coming, with more conservative analysts predicting a return closer to or even below $30,000 throughout January.Ether returns to established supportAltcoins, meanwhile, took a noticeably harsher hit as Bitcoin fell.Out of the top 10 cryptocurrencies by market capitalization, 10% drops were commonplace and rebounds limited, with only Terra (LUNA) reining in losses to under 5%.Related: Breaking ‘bear market’ in Bitcoin demand will spark next BTC price surge — AnalystsEther (ETH) fell to crucial support around $2,800, the site of an all-time high from last April, to cap weekly losses approaching 15%.ETH/USD 1-hour candle chart (Bitstamp). Source: TradingView

Bitcoin (BTC) surged on the Wall Street open on Jan. 20 as news that Russia was planning to “ban” cryptocurrency failed to impact price performance.BTC/USD 1-hour candle chart (Bitstamp). Source: TradingViewBTC price climbs $2,500 in 24 hoursData from Cointelegraph Markets Pro and TradingView showed BTC/USD adding $1,500 over several hours on Thursday, continuing the upside move, which began with a bounce off $41,000.At the time of writing, the pair was acting above $43,000, having reached highs of $43,468 on Bitstamp.That peak represented an eclipse of resistance immediately above the $43,000 mark, and investors are now watching to see whether Bitcoin can hit higher targets.”A weekly close just like this (i.e. above ~$43,100) would be enough for BTC to build on this early bullish momentum and move higher,” trader and analyst Rekt Capital argued in his latest Twitter update.””Still a few days left for the weekly close to confirm this but so far, so good.”Bitcoin trying to break out of 2+ month-long downtrend pic.twitter.com/VaQynQgT05— Will Clemente (@WClementeIII) January 20, 2022Others zoomed out further, with fellow analyst William Clemente noting a possible breakout of a downtrend in place since early December.The action came despite fresh desires to clamp down on Bitcoin and cryptocurrency more broadly from Russia’s central bank, with comments calling for a blanket ban on circulation and usage as well as mining.Unlike similar announcements — and reiterations of those announcements — by China, the market was entirely unfazed by the plans, something which was not lost on pundits.”Russia is looking to repeat the mistakes of China,” analyst and podcast host Scott Melker, known as the “Wolf of All Streets,” reacted.A $34 million hack of trading platform Crypto.com likewise failed to dent enthusiasm.Altcoins seize a chance to moveOptimism also extended to altcoins as Bitcoin moved up, with Ethereum (ETH), Solana (SOL) and Terra (LUNA) leading the top ten cryptocurrencies by market cap.Related: Breaking ‘bear market’ in Bitcoin demand will spark next BTC price surge — AnalystsETH/USD added around 3% on the day, making the chances of a $3,000 retest at least temporarily less likely.ETH/USD 1-hour candle chart (Bitstamp). Source: TradingView”Very good movements on the markets,” Cointelegraph contributor Michaël van de Poppe summarized.