Bitcoin Price Remains Motionless as Bulls, Bears Lack Confidence
Bitcoin’s trading range continued to narrow on Tuesday, reflecting a lack of committal from the bulls and bears following the weekend pump-and-dump.
Lack of Direction
The bitcoin price fluctuated within a $60 range on Tuesday, according to data provider CoinMarketCap. At the time of writing, BTC/USD was averaging $3,588.94, where it was virtually unchanged compared to Monday. On individual exchanges, bitcoin fluctuated between $3,563 (HitBTC) and $3,627 (Bitfinex).
Trading volumes in the last 24 hours exceeded $5.1 billion, with derivatives platform BitMEX processing nearly 16% of the transactions. Bitcoin trading activity has witnessed a considerable uptick in South Korea, with BTC/KRW transactions climbing.
At current values, bitcoin has a total market capitalization of $62.8 billion, accounting for 52.5% of the entire crypto universe. The total cryptocurrency market was last valued at $119.7 billion.
Bitcoin experienced large fluctuations over the weekend, rising 4% on Saturday and falling nearly 3% on Sunday. Altcoins and tokens followed closely in its footsteps, a trend that has intensified during the bear market.
Longest Bear Market in History Looms
In less than one month, bitcoin will enter its longest bear market in history. As of Tuesday, the crypto bear market has lasted a whopping 396 days. The longest bear trend ever observed was in 2014-15, when it stretched on for 420 consecutive days.
The bitcoin price bottomed near $3,100 in December before staging a large rally into the new year. After climbing more than 30% from last month’s low, price action has been largely confined to the $3,500-$3,700 range.
Bitcoin’s posturing in the latter stages of the bear market underlies a significant lack of confidence among traders. This technical tug-of-war has made it difficult to gauge the future trajectory of bitcoin and, by extension, the broader cryptocurrency market. The fundamental issue for many traders is determining whether bitcoin has reached a definitive bottom or whether prices will come barrelling down again. A longer historical track record makes technical analysis more trustworthy than in the past, but in the case of bitcoin, uncertainty around regulation and mainstream adoption make purely technical indicators insufficient in analyzing the market.
To that end, markets are setting their sights on the February deadline for the VanEck SolidX Bitcoin Trust, a highly-touted bitcoin ETF that could hasten crypto adoption among retail investors. Cryptocurrency advocate and CBNC contributor Brian Kelly believes there is virtually no chance that the SEC approves the ETF in question. In his view, a bitcoin ETF is at least a year away. This view is fairly consistent across the board, though many in the financial community believe a bitcoin ETF is only a question of when and not if.
More on the crypto ETF debate: Crypto Markets Get a Boost Heading Into the Weekend as Debate Over Bitcoin ETF Intensifies.
Disclaimer: The author owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
Featured image courtesy of Shutterstock.