The bitcoin price has reached another new all-time high of around $29,950 on January 2, 2021, as it strives to conquer the $30,000 level. Bitcoin recorded this all-time across major exchanges which means that it is almost reaching the psychological resistance level that has formed at $30,000.
Surpassing $30,000 may enhance a renewed confidence in the market, with the final remaining technical roadblock located right below that zone.
Thus, in the short term, sellers will need to defend the $30,000 resistance zone with stacked sell orders. For now, the exchange order books indicate huge sell orders in the $29,800–$30,000 range.
$29,800 Is Crucial For Another Surge For Bitcoin
Most of the exchange order books on both Bitfinex and Binance show significantly large sell orders from $29,800 to $30,000. It means that the sellers may try to lead a major bitcoin pullback before it conquers $29,800 sustainably.
One trader known as ‘Loma’ similarly highlighted that if BTC was to face rejection at $30,000, it might plunge from $29,800. Currently, the flagship crypto is consolidating gains above $29,600. He explained:
“BTC either blows through $30,000 over the next few days into the $31-33k territory or we front-run and reject at like $29,800. Basically what I’m saying is, if you’re shorting $30k, there’s a very good chance you’re going to be ran over.”
Traders and investors in the BTC futures market have been trying to suppress the bitcoin price and have shorted massively in the last 48 hours. Notably, the futures funding rate on the Coinbase exchange and other major exchanges have hovered around 0.01%, despite the recent rally.
— Coinalyze (@coinalyzetool) December 31, 2020
Sometimes, it dropped below 0.01% which indicates that most of the market was shorting or selling bitcoin. Nonetheless, retail investors participating in the bitcoin spot market have been accumulating bitcoin. The spot market is a group of exchanges that do not offer derivatives and leverage.
On December 31, 2020, the bitcoin price rallied to a new all-time high. Santiment analysts stated that they spotted a surge in on-chain movements which might point to retail accumulation.
Retail investors on Coinbase might have acquired bitcoin entering into 2021 because Coinbase saw a huge premium over other major exchanges, like Binance. The analysts stated:
“As #Bitcoin’s markets opened on 2021 for the first time about 30 minutes ago (UTC), prices have jumped to $29,460 as $BTC has made yet another AllTimeHigh. Active addresses are on the rise in recent hours to support this push.”
In the short term, Bitcoin might see a major battle between futures short-sellers and retail investors existing in the spot market as the price surges towards $30,000.
What Comes Next?
In the short term, it would be important to see BTC’s behavior at $29,800. There is a major possibility that it might pull back without surging to that level, which may result in a decent-sized correction.
If bitcoin rises sustainably above $29,800, then a wider rally above $30,000 might happen in the near term. Several metrics suggest that bitcoin will look to extend its gains in the first quarter of 2021.