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Breaking News: Bitcoin Price Tumbles Toward $98,000: What’s Driving The Drop And What Lies Ahead
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Breaking News: Bitcoin Price Tumbles Toward $98,000: What’s Driving The Drop And What Lies Ahead

Bitcoin Kicks Off Week Above $17,000, Market Sentiment Turns Optimistic

Reynaldo Marquez
Reynaldo Marquez
Last Updated: June 11, 2024 2:31 pm
2 mins read
Bitcoin Price

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Bitcoin is seeing some green during this week’s market opening and seems poised to reclaim higher levels in the short term. The number one crypto by market cap experienced some of its worst months in history, but the bulls were able to hold the line at around $15,500. 

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Now, the macroeconomic outlook is changing and could start supporting further profits for risk-on assets. As of this writing, Bitcoin trades at $17,200 with 2% and 5% profits in the last 24 hours and seven days, respectively. 

Bitcoin BTC BTCUSDT
BTC’s price moving sideways on the 4-hour chart. Source: BTCUSDT Tradingview

Bitcoin Market Is Getting Back To Normal

Data from crypto derivatives exchange Deribit indicates a shift in market sentiment. Participants are more optimistic about Bitcoin after the collapse of the crypto exchange FTX and the fall from the grace of its co-founder and former CEO Sam Bankman-Fried. 

This event pushed Bitcoin to a new yearly low and back to its 2020 levels. As seen in the chart below, the BTC Open Interest Weighted Annualized Basis shows that the prices of options contracts were in backwardation. 

In other words, options were cheaper than their underlying asset, Bitcoin, following the FTX collapse. The last time BTC saw similar backwardation was in July 2021, during the second capitulation event that triggered a 40% crash in the crypto market. 

However, the chart shows that in July 2021, market sentiment and backwardation were far from their November 2022 levels. In addition, the chart shows that the heavy selling triggered by recent events is decreasing, and the crypto market is normalizing. Deribit stated:

In July 21, the whole curve didn’t invert as the longer-dated contracts still traded at a premium. Since 8 November this year, we however see the whole curve trading below spot.

Bitcoin BTC BTCUSDT Chart 2
Source: Deribit

BTC’s Price Short-Term Rally Is More Likely

Paired with the above, Deribit claims the BTC 25 put skew, a metric used to gauge market sentiment by looking at the demand for put (sell) options contracts, and their implied volatility is also on the decline. Puts were expensive during the FTX fallout but are returning to their “normal” levels. Deribit said:

A drop in 1 Month Skew indicates the shorter-dated out the money calls are getting more expensive relative to the out the money puts.

In other words, market participants are buying more calls (buy) contracts. These options have a short-term expiration date. Thus, people might be gearing up for a Christmas or end-of-the-year rally. 

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As NewsBTC reported, the max pain point, the strike price at which a large portion of the contract will expire worthless, stands at $20,000. 

Bitcoin BTC BTCUSDT Chart 3
BTC Options’ Open Interest for the December 30th expiry. Source: Deribit
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Reynaldo Marquez
Reynaldo Marquez

Reynaldo Marquez

A literature major, Reynaldo Márquez has been deeply immersed in the crypto industry since 2017. His journey began with translating articles for various crypto news outlets, a role he took on with zeal. In 2018, amidst a challenging market, he embraced his first writing assignment, demonstrating his unwavering commitment to the nascent industry and the promise of change it bears for many people worldwide.
In March 2021, he joined the prestigious crypto news outlet NewsBTC and Bitcoinist, where he not only reported on the latest crypto news but also had the privilege of interviewing some of the industry's most influential figures. A year later, his dedication and hard work were recognized, and he was promoted to Managing Editor, a position he currently holds with pride.
He believes in honesty, good communication, hard work, and the power of cryptocurrency and its potential to transform people's lives, especially those alienated by the legacy financial system. Born in 1992 in Venezuela, Reynaldo is familiar with how governments and central banks can negatively affect people, their everyday lives, and their futures by creating inflation and erasing their hopes for a better future. Thus, like many Venezuelans, he embraced this new technology to help him and his family navigate difficult times.
In another life, Reynaldo would have pursued a career as an investigator, most likely tracking down the origins of the Cyberpunk movement with the publication of William Gibson’s ‘Neuromancer.’ The intersection between fiction and reality, with the materialization of Bitcoin in 2009, would have allowed him to dive deep into the crypto sphere as something more than a financial phenomenon but also a cultural shift in society that was brewing since the XX century, and maybe even sooner, in the XIX century with the publication of Henry David Thoreau’s ‘Civil Disobedience.’
But that’s for another life. In this one, Reynaldo has been trading to improve his trading skills. Since 2023, he has been trying to learn Python to create successful strategies and find ways to execute them. It is a difficult task, which continues to keep him busy today and will most likely continue to keep him busy in the near and long term.
In his free time, he enjoys lifting heavy objects, reading, watching movies, and listening to his favorite music. Some of his favorite authors are Walt Whitman, William Faulkner, Allen Ginsberg, James Baldwin, Raymond Carver, Ray Bradbury, George Orwell, Mario Vargas Llosa, Reinaldo Arenas, Rafael Cadenas, and many others. Lately, he has been primarily interested in reading about dystopic societies, a topic that deeply resonates with the crypto industry.
Since 2023, he has lived in Spain with his wife. He loves the weather, the food, and the people and their culture. They both expect to travel much more within the country they now call home and beyond its border. He hopes to retire with his wife, maybe in a quiet place near a beach, but most likely in a city close to a library and a university with his kids and, hopefully, grandkids.

Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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Reason to trust

Strict editorial policy that focuses on accuracy, relevance, and impartiality
Created by industry experts and meticulously reviewed
The highest standards in reporting and publishing
How Our News is Made

Strict editorial policy that focuses on accuracy, relevance, and impartiality

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