Bitcoin sells off after $44K resistance tap, eliciting scrutiny from options traders

Bitcoin
(BTC)
fell
more
than
2%
from
local
highs
during
Jan.
13
in
the
latest
move
to
keep
market
participants
guessing
about
what’s
to
come
for
the
largest
digital
asset. 


BTC/USD
1-hour
candle
chart
(Bitstamp).
Source:
TradingView

“One
step
at
a
time”

Data
from

Cointelegraph
Markets
Pro

and

TradingView
 tracked
the
pullback
for
BTC/USD
after
the
pair
hit
its
highest
levels
in
more
than
a
week.

A
trip
to
$44,450
on
Bitstamp
after
the
Wall
Street
open
was
followed
by
an
hourly
candle
that
at
one
point
sparked
losses
of
$1,500.

A
fresh
sign
that

rangebound
activity
remains

the
order
of
the
day
for
Bitcoin,
bulls
were
disappointed
after
multiple
calls
for
a
fairly
easy
squeeze
toward
$46,000.

For
popular
trader
and
analyst
Scott
Melker,
“There
was
still
no
clear
sign
of
direction.”

“Still
just
chopping
sideways,”
he

told

Twitter
followers
on
the
day,
noting
that
Bitcoin
had
swept
lows
with
its
sub-$40,000
dive
earlier
in
the
week,
which
was
also
in
line
with
his
own
predictions.

Fellow
Twitter
account
Daan
Crypto
Trades
further
highlighted
$45,700
as
an
upside
target
important
for
a
resistance/support
flip.

“The
$45.7K
level
is
the
next
area
of
interest
that’s
on
my
radar.
It
will
be
key
to
flip
that
level
for
the
bulls,”
he

wrote
.

“BTC
looks
great
on
LTF
but
still
has
a
lot
of
work
to
do
on
HTF
to
call
this
a
proper
reversal.
One
step
at
a
time.”

Others
were
more
hopeful
of
a
paradigm
shift
coming
in
the
mid-term.

“Over
the
coming
days
and
weeks,
BTC
may
reveal
a
new
market
structure
in
which
case
it
would
be
well
worth
paying
close
attention
to
it,”
trader
and
analyst
Rekt
Capital

forecast
.



Related:

Traders
say
Bitcoin
run
to
$44K
may
be
a
relief
bounce,
citing
a
repeat
of
December’s
‘nuke’

Options
traders
come
under
the
spotlight

New
research
also
suggested
the
reason
that
$40,000
was
short-lived
as
a
dip
and
$44,000
conversely
became
an
area
of
resistance
afterward.

According
to
crypto
trading
firm
QCP
Capital,
the
determining
factor
lies
in
options
markets,
which
have
now
become
significant
enough
to
have
a
“material
impact”
on
BTC
price
action.

“For
instance,
one
key
reason
for
the
lack
of
follow
through
in
BTC
and
Ether
below
$40,000
and
$3,000
is
possibly
the
few
large
players
owning
strikes
around
those
levels,” a
Telegram
update
explained.
“They
naturally
create
support
as
they
bid
for
spots
to
trade
the
delta
there.
And
when
they
take
profit
on
those
option
positions,
the
upside
impact
on
the
market
is
very
clear
as
well.”

“Additionally,
a
sharp
options
player
who
had
bought
42,000
January
calls
started
taking
profit
on
those
around
the
$44,000
spot
level,
naturally
creating
some
resistance
there.”

Options
open
interest
remains
far
from
2021’s
all-time
highs,
data
from
Coinglass

shows
.


Bitcoin
options
open
interest
chart.
Source:
Coinglass

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