Crypto Weekly: 2/24/2021
Market Recap: New ATHs & Continued Volatility
Bitcoin rallied to a high of $58,367 on Sunday before commencing a 23% sell off down to $44,888 yesterday morning and bouncing to its current price of $48,770. In our view, the recent move is nothing more than a nice healthy correction and we think recent events have de-risked the market. We continue to believe the fourth crypto bull market remains intact and our Bitcoin price target remains $100k.
Source: Tradingview
One reason we believe the recent sell off puts the market on sounder footing is the impact it has had on leveraged. We had generally been moving higher for the last month and momentum traders have been riding that wave with margin long positions. The sell-off on Sunday and Monday liquidated $3.6B and $2.3B of long futures positions, respectively. Putting these numbers in perspective, the total Bitcoin futures open interest across all exchanges dropped 16% from $19B to $16B over the last few days according to Skew. We think this offers a nice reset that could set us up for the next moving higher.
Source: ByBit
Looking back to the prior bull market in 2017, we see that the best times to add crypto exposure were following similar sell offs. During the six ~30%+ sell offs we tallied, t...Reports you may have missed
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