Market Lab Report - Quick update on bitcoin and ethereum

Published:

15 Feb 2021 12:01 ET

Both bitcoin and etherum are coming up against major levels of psychological resistence, namely the $50,000 and $2,000 price levels, W. Woo, a well respected analyst, writes, "Capital flows continue to be bullish however recent price action has outstripped fundamentals, a bullish consolidation is expected (this may take a week) before a bullish breakout to explore new highs."

We got that consolidation around 7 pm EST on 2-14-21 with bitcoin losing $4000 in a couple hours. The market has since bounced [as of this writing] and futures funding levels have nicely reset. When funding gets overheated, this is often a major headwind for further advancement in the price of bitcoin. The last time funding levels spiked was in early January. Bitcoin then had a major -31.4% correction. This time, the reset is looking to have happened much faster. The Grayscale effect which is the bullish price action on spot prices after major unlocking of GBTC shares, remains bullish, and on-chain indicators continue to look healthy. Bitcoin has made a couple attempts closing in on 50,000 while ethereum is in spitting distance of 2,000. The longer this consolidation lasts, the higher the probability both coins can blast through these levels. Stay tuned.

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