Where Will Bitcoin Prices Go in December?
In response to Bitcoin’s current dip, two distinct narrative themes have emerged in the market. One is that many ordinary investors will continue to sell, as they believe that the bull market has ended and that prices will continue to drop. The other narrative is that whales’ holdings keep increasing as they are still relentlessly buying at the moment.
To begin with, retail investors’ buying preference continues to decline, as they are concerned that the market will decline. It’s likely this negative type of investment sentiment will spread, resulting in significant selling pressure, bringing with it the risk of a BTC price crash.
Secondly, large investors are confident at increasing their holdings. MicroStrategy, the world’s largest Bitcoin holder, purchased 7,002 bitcoins in October and November for an average price of $59,187. It now owns a total of 1,21044 BTC, with an estimated value of $7 billion.
Nonetheless, as you would expect overall market sentiment remains low after the market has endured a period of decline. At 10:00 a.m. on December 3, the market sentiment index was 31, indicating panic.
Clearly, the crypto market desperately needs to establish a positive direction to calm people’s nerves!
We are also faced with a dilemma in the options market. The four most plausible possibilities for the $950 million option, which expired on December 3, were examined by experts. The number of active calls (buy) and put (sell) futures vary depending on the price on the expiry date:
· Between $54,000 and $56,000: 290 bullish vs 3,480 bearish. The result is $175 million in favor of put options.
· Between $56,000 and $58,000: 750 bullish vs 2,160 bearish. The result is $80 million in favor of put options.
· Between $58,000 and $60,000, 1,510 bullish versus 1,040 bearish. The result is $30 million in favor of call options.
· Above $60,000, 2,760 bullish vs 860 bearish. The result is that $115 million in favor of the bullish (bull market).
Therefore, the only way for ‘longs’ to avoid losses on the option delivery date is to push the price of Bitcoin above $58,000, which is a 2% difference from $56,900. However, if the short-term negative sentiment prevails and the Bitcoin price remains below $56,000, the ‘bears’ may exert some pressure and eventually could earn up to $175 million in profits.
There is still a long way to go in December, and Bitcoin’s functionality is improving all the time. As of December 3, the capacity of the Bitcoin Lightning Network has surpassed 3,300 BTC, which is about US$187,098,180.16, a 4% increase from the previous day; moreover, the number of Bitcoin Lightning Network channels had surpassed 82,118, a 75% increase from the last day. With a daily growth of 3%, nodes reached 31,230, up 5.02% from the previous day.
Miners also generated revenue of $1.688 billion (27,760 BTC) in November.
When analyzing market data, the four-hour line clearly shows a downturn, but the MA30 remains in an upward trend, and the Bollinger Bands also show signs of contraction. In the short term, if there is a decline, $54,000 remains a strong support position.
Therefore, in the final month of 2021, the variables are still quite large, and investors must also be patient. Bitcoin still has a promising future. Indeed, it maybe you will look back and discover that you have passed up the ideal opportunity to increase your positions! Be patient; everything will come to pass, and the likelihood is that the market situation will improve.
Finally, I hope that everyone will visit BigONE’s futures community to receive a 15 USDT prize.