Analysts warn that it looks more and more like speculation, but so far, open interest has been “unbundled”.
Market Update
Bitcoin (BTC) refused to contain recent losses on January 22 as predictions of a flight to $33,000 and below looked increasingly likely to come true.
Open concerns “still not flushing”
Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it dropped to $35,000 in the first half of Saturday.
With a few silver linings available for the bulls, weekend lower volume is poised to yield some classic erratic moves after Bitcoin lost support at $40,000 on Friday.
While some, including El Salvador, have taken full advantage of the new lower lows, others expressed concern that despite the drop, pressure remains on the bulls.
“The crazy part is that open interest hasn’t come down yet,” said trader and analyst William Clemente summary, one of many market participants noted that derivatives traders are still trying to fight the trend.
“After all the carnage and the sheer state of the funding somehow not being giga negative, the futs are not backing down and the OI is barely dropping. Interesting time. And by ‘interesting’ I mean poverty,” added the popular Byzantine Basic Twitter account Fleer.
RSI drops to COVID lows in March 2020
A slight source of relief came from Bitcoin’s relative strength index (RSI) on the day, which fell to its lowest level since March 2020.
Related: Here are 3 ways the relative strength index (RSI) can be used as a sell signal
At the time, BTC/USD dipped to $3,600 before staging a comeback that could last year.
The daily RSI stood at just 20 on Saturday, already well below the classic “oversold” zone.
“Slightly more reliable than Bitcoin -> total market cap is at next support, while daily RSI hits lowest level since March 2020,” Cointelegraph contributor Michaël van de Poppe commented about the situation.
“Stock sentiment is also at its lowest level since March 2020. Speaks of it all.”
The stock market took a hit over the weekend, with tech stocks especially in the line of fire and crypto once again showing its level of positive correlation.