- Bitcoin is trading sideways below the $43,000 level on Thursday.
- BTC halving event, which is 110 days away, is considered a typical catalyst for Bitcoin price.
- Altcoin season kicked off on January 14 as BTC dominance shrunk to 47.5%.
Bitcoin (BTC) market participants look indecisive as BTC trades sideways below $43,000 on Thursday. Bitcoin price has declined nearly 8% in the past week after the spot Exchange Traded Fund failed to support prices, giving way to a so-called "altcoin season." The BTC halving event, which is considered a catalyst for Bitcoin price, is 110 days away.
Also read: Bitcoin records largest transaction of 2024, $665.3 million BTC transferred on Tuesday
Daily digest market movers: Bitcoin price action disappoints traders
- Bitcoin price has fallen well below its two-year high of $48,989, declining nearly 8% in the past week.
- BTC price action disappointed market participants since the approval of the ETFs. This has lead to a decrease in Bitcoin dominance, which has dropped to 47.5%, according to data from CoinGecko.
Bitcoin dominance. Source: CoinGecko
The Altcoin Season Index, which tracks whether 75% of the top 50 cryptocurrencies performed better than Bitcoin, reads 78 on Thursday. This indicator also signals that the "Altcoin Season" kicked off on January 14 for the first time since end-2022.
Altcoin Season Index. Source: Blockchaincenter.net
Experts consider the Bitcoin halving event a catalyst for BTC price, mainly because prior halving events have come together with price increases. The halving event is 110 days away, according to data from the countdown timer on Nicehash.com. The event will slash the reward for mining BTC blocks, meaning miners will receive half the current reward for verifying transactions on the Bitcoin blockchain.
The mining reward will be slashed to 3.125 BTC per block after the fourth halving in April.
Technical Analysis: Bitcoin price trades below $43,000
The start of the Altcoin season is likely taking the shine away from Bitcoin price action as investors shift their preferences towards other cryptocurrencies. In this context, BTC price is trading sideways below the $43,000 level on Thursday. In the past week, BTC price dropped nearly 8%.
The asset’s price has dropped below the 50% Fibonacci retracement level of the price decline between November 2021 and 2022 at $43,074. This marks a key resistance in BTC price recovery. The other two key resistances are marked as R1 and R2 in the chart below, representing the imbalance zone between $43,589 and $45,613.
BTC/USDT 1-day chart
A daily candlestick close above the $43,074 level could invalidate the bearish thesis for Bitcoin price.
Open Interest, funding rate FAQs
How does Open Interest affect cryptocurrency prices?
Higher Open Interest is associated with higher liquidity and new capital inflow to the market. This is considered the equivalent of increase in efficiency and the ongoing trend continues. When Open Interest decreases, it is considered a sign of liquidation in the market, investors are leaving and the overall demand for an asset is on a decline, fueling a bearish sentiment among investors.
How does Funding rate affect cryptocurrency prices?
Funding fees bridge the difference between spot prices and prices of futures contracts of an asset by increasing liquidation risks faced by traders. A consistently high and positive funding rate implies there is a bullish sentiment among market participants and there is an expectation of a price hike. A consistently negative funding rate for an asset implies a bearish sentiment, indicating that traders expect the cryptocurrency’s price to fall and a bearish trend reversal is likely to occur.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
US presidential election outcome could shape the future of crypto
US citizens will go to the polls to elect a new president on November 5, and their choice could be key for the future of the crypto industry and thus the price outlook for Bitcoin (BTC).
Bitcoin ETFs beat Gold ETFs with 65% gain since launch
Bitcoin ETFs have reshaped the digital asset investment landscape since their approval in January. Their total assets under management climbed over $70 billion during the weekend, placing them ahead of other investment products, including gold.
XRP eyes 10% rally amid relisting across crypto exchanges and growing institutional demand
Ripple's XRP is trading at $0.5050 up slightly by 0.2% in the past 24 hours as it struggles to sustain a move above a key symmetry triangle resistance. Meanwhile, in its recently released Q3 report, Ripple noted the rising listing and relisting of XRP across crypto exchanges and global platforms.
Ethereum Price Forecast: ETH struggles below $2,500 amid State of Michigan pension fund investment in ETH ETF
Ethereum is trading near $2,420, down about 1% on Monday, but could bounce off a key descending trendline close to the $2,258 historically high demand zone. Meanwhile, the State of Michigan pension fund revealed an investment of $11 million in ETH exchange-traded funds.
Bitcoin: New all-time high at $78,900 looks feasible
Bitcoin price declines over 2% this week, but the bounce from a key technical level on the weekly chart signals chances of hitting a new all-time high in the short term. US spot Bitcoin ETFs posted $596 million in inflows until Thursday despite the increased profit-taking activity.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.