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BitcoinSistemi 2025-01-07 06:48:07

Why Bitcoin Price Suddenly Rallied, Does It Have the Strength to Continue? Analytics Company Predicts What Happens Next

Cryptocurrency analytics firm Blofin Academy has released its assessment of Bitcoin’s recent rally, attributing the upward momentum to rising investor sentiment and moderately supportive actions from market makers. However, the firm warns of potential market volatility due to macroeconomic uncertainties and derivatives traders' positions. The first trading day following the New Year holiday saw a notable recovery in both U.S. stock and crypto markets. Despite the high levels of the DXY index and U.S. Treasury yields, Bitcoin (BTC) and the S&P 500 ETF (SPY) displayed strong upward momentum, reflecting renewed investor confidence. The easing of post-holiday risk aversion played a significant role in the recovery. For SPY, the hedging behavior of market makers, driven by a positive gamma peak, provided significant support that allowed for a steady recovery. Related News: Analyst Says "Cryptocurrencies Will Be Like the New Space Race in the Trump Administration", Shares What He Expects According to the analytics firm, Bitcoin is exhibiting different market dynamics compared to SPY. Following the “cryptocurrency witching day” that represented the last hour of live trading, the positive gamma inventory held by market makers has decreased significantly, while the negative gamma inventory has remained significant. This has led market makers to adopt a “buy the tops, sell the bottoms” strategy for BTC, unlike SPY, where they sell high and buy low. As a result, implied volatility (IV) for BTC remains high, while SPY’s IV has moderated. Investor optimism continues to be the primary driver behind Bitcoin’s price rally. Increased buying of call options by investors has shifted the market skew bullish. However, Blofin Academy notes that this bullish bias is concentrated in near-month options, limiting the sustainability of price momentum in the long term. Block traders appear to be expecting a period of price volatility for Bitcoin around the $100,000 level. Many have taken credit buys and sells near this level, indicating expectations of a short-term pullback. Despite these fluctuations, medium- and long-term sentiment remains positive, with investors maintaining a bullish outlook on Bitcoin’s overall outlook. *This is not investment advice. Continue Reading: Why Bitcoin Price Suddenly Rallied, Does It Have the Strength to Continue? Analytics Company Predicts What Happens Next

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