Despite the strong recovery in Bitcoin last night to overcome the massive selling, the bulls struggled to hold the momentum to continue the recovery rally. After creating a 24-hour high at $102,569, the BTC price took a quick reversal.
With an intraday pullback of 2.74%, Bitcoin currently trades at a market price of $98,682. With a new bearish candle in the daily chart, BTC is now hinting at a prolonged downtrend.
Will this downfall in BTC result in a breakdown of the local trend line to crash under the $90,000 mark? Let’s find out.
Bitcoin Analysis Reveals Hold-Off Above 50 EMA
In the daily chart, the massive lower price ejection in the recent bullish candle seems pretty evident. However, the bullish recovery is mostly undermined by the intraday bearish piercing candle.
This breaks under the 50-day EMA line as BTC loses its at the $100,000 psychological mark. However, the stochastic RSI lines give a positive crossover in the oversold territory, hinting at a potential recovery.
Furthermore, the bullish engulfing candle on February 3 highlighted a strong for BTC near $97,700. Hence, as long as BTC sustains a closing price above $97,000, the uptrend is likely to continue.
Signs of Bullish Sentiment in Bitcoin Derivatives
Amid the increasing volatility in the BTC price trend, the derivatives market witnessed a minor recovery. The funding rate in BTC has returned to positive levels after momentarily dipping at -0.0032%.
Currently, the funding rate remains at 0.0054%, reflecting a surge in bullish sentiments. Furthermore, the long-to-short ratio over the past 24 hours has resurfaced to nearly normal levels at 0.9928.This reveals almost equal parts of bearish and bullish positions at play. Meanwhile, the open interest remains at $60.21 billion, marking a slip of -2% over the past 24 hours.
Hence, despite the pullback in the open interest, the overall outlook in the derivatives market remains highly optimistic, as the bulls are willing to pay the to hold their long positions.
Bitcoin Institutional Activity: ETF Outflows Raise Concerns
The solid optimism in the derivatives market comes despite the significant outflow in the US spot Bitcoin ETFs. The institutions on February 3 recorded an overall net outflow of $234.54 million.
Among the top sellers, Fidelity sold $177.64 million, while ARK and 21Shares bled $50.75 million. The sole purchase of BTC remains with Grayscale, with an inflow of $8.02 million.
However, its cumulative inflow still remains at a negative $21.88 billion.
Bitcoin Price Targets
Amid rising speculations, the short-term target in BTC is likely to reach the overhead ceiling at $104,555. However, a declining trend in BTC ETFs will prolong the downfall in BTC prices.
Hence, on the flip side, a crucial under $97,500 remains the trend line near $94,600.
