Analysts are now noting that technical indicators may point to the possibility that Bitcoin is in the process of bottoming out, but BTC’s inability to post any strong bounce at $8,000 may point to an underlying weakness amongst the crypto’s buyers.
Bitcoin Falls to Key Support Level at $8,000
At the time of writing, Bitcoin is trading down nearly 5% at its current price of $8,160, which marks a notable drop from its daily highs of nearly $8,600 that were set yesterday morning.
Today’s dip to lows of $8,000 marks an extension of the sell-off that first occurred when BTC fell below $9,000, which had previously proven to be a strong support level for the cryptocurrency.
BTC did post a slight bounce at $8,000 today, signaling that this is a near-term support level that could bolster the cryptocurrency’s near-term price action.
One interesting factor that may play into Bitcoin’s near-term price action is the fact that leveraged funding is currently positive, meaning that there is a premium cost to enter long positions, which makes short positions a better value proposition at the moment.
Big Chonis, a popular cryptocurrency analyst on Twitter, discussed this in a recent tweet, explaining that it is currently a better value to countertrade using short positions until the ongoing downtrend begins shifting.
“$BTC – ever since the late October pump, Leveraged funding has been positive meaning there has been a premium cost to enter LONG positions even while #bitcoin continues to retrace, until this goes negative it’s still a better value to countertrade short, until proven otherwise.
$BTC – ever since the late October pump, Leveraged funding has been positive meaning there has been a premium cost to enter LONG positions even while #bitcoin continues to retrace, until this goes negative its still a better value to countertrade short, until proven otherwise