Near-term Bitcoin price dips won’t likely be as violent as last week’s 10% plunge, as selling pressure has significantly eased after Bitcoin’s first spike above six figures, according to a crypto analyst — though others remain skeptical.
“With such a decline in realized profit and sell-side pressure, we can expect future declines to be less abrupt than the one experienced last week,” Bitfinex analysts said in a Dec. 9 markets report.
Signals of ‘easing sell-side pressure’ emerges
On Dec. 6, over 24 hours, Bitcoin (BTC) dropped almost 10% from $103,493 to under $93,000, just one day after surpassing the $100,000 price level for the first time on Dec. 5, according to CoinMarketCap data.
Bitcoin is up 0.34% over the past seven days. Source: CoinMarketCap
Cointelegraph reported that the sudden price decline from $98,338 to $92,957 triggered over $303.5 million in liquidations of long positions within the hour, pushing total liquidations over the 24 hours to $404 million.
However, Bitfinex analysts said signs of “market stabilization are emerging.”
“Realized Profit RP, which tracks the USD gains from moved coins, peaked at $10.5 billion daily during Bitcoin’s surge towards $100,000. However, it has since fallen to around $2.5 billion per day, reflecting a 76 percent drop.”
They explained this suggests that profit-taking has “significantly cooled” and that further sell-offs may be “less dramatic in nature.”
At the time of publication, Bitcoin is trading at $97,483, according to CoinMarketCap.
The Bitfinex analysts also said that Bitcoin’s funding rates are “stabilizing” too, explaining that the market is transitioning to a “more balanced phase, where volatility is likely to be more contained and price movements less erratic in the medium term.”
Funding APR Heatmap. Source: CoinGlass
The current funding rate for Bitcoin on the world’s largest crypto exchange, Binance, is 0.01%, according to CoinGlass data.
However, Glassnode lead analyst James Check remains uncertain about the market stabilizing.
“Sell-side pressure by existing holders is tremendous right now, and in my view,…
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