In the coming days, Bitcoin traders will seek to create new BTC price records—if large-scale 'fear of missing out' (FOMO) sentiment begins, can the market avoid a significant pullback?
Bitcoin has started a new week, just a step away from new historical highs, and has set the highest weekly closing price ever recorded.
Bitcoin traders expect price discovery to return this week, viewing $80,000 as a buying opportunity on dips.
This week's closing price has set a new record, but the BTC price trend for November 2024 remains within expected ranges.
There is a divergence in the market regarding how the Federal Reserve will address the issue of 'stagflation.'
Despite last week's historical peak of $93,500 triggering a short-term response, whales continue to buy BTC, and ETF inflows remain high.
Meanwhile, the crypto market sentiment indicators are showing increasingly high signs of overheating, with 'extreme greed' levels reaching typical market top areas.
Traders prepare for BTC price volatility towards $100,000
After a record weekly closing price, Bitcoin only experienced a slight drop, forcing shorts to capitulate.
Data shows that as of the first Wall Street opening this week, BTC/USD remains above $90,000, with a 30% increase for the month. This data comes from Cointelegraph Markets Pro and TradingView.
“Currently, the usual buying at the beginning of the week has pushed prices higher,” trader Skew stated in his latest post on platform X.
Skew pointed out that within the four-hour timeframe, prices are holding above the 21-period exponential moving average (EMA), highlighting two key levels for this week: $90,000 and $91,300.
“It would be great if prices could quickly surge to $95,000-$96,000 this week,” another trader CrypNuevo remarked in a post on platform X over the weekend.
CrypNuevo predicts that many traders may choose to liquidate newcomers near the $100,000 price, leading to increased market volatility before this key psychological price point.
“The main liquidation levels are above, but it is also possible to see a quick surge near $100,000 without truly touching it, followed by a drop,” he wrote.
“Why? Because many new traders will enter the market for the first time due to FOMO (fear of missing out), going long or buying spot, becoming easy prey.”
He added that if the market shows signs of consolidation, the $87,000 level needs to hold.
Others plan to 'buy the dip' as BTC further retraces. For trader Crypto Chase, the appropriate entry point is the 'gap' area of the daily candle.
“We will eventually retrace to the daily gap. In a bull market, the first gap is the buying point. I still hold a 30% long position opened around $85,000. If we reach the $83,000 high, I will still buy,” he told fans on platform X.
“Before a market reversal or a turn to a bear market, the low gaps should remain unfilled.”
BTC price weekly close hits record high
For Bitcoin bulls, last week was undoubtedly a historic victory.
BTC/USD not only set the highest weekly closing price near $90,000 for the second consecutive time but also did not show a significant pullback to test new support levels.
Monitoring platform CoinGlass shows that Bitcoin rose by 11.8% last week, with fourth-quarter gains surpassing 40%.
In terms of monthly performance, the BTC price performance for November 2024 is comparable to the average level over the past decade. However, traders believe this situation could still change.
“Historically, this often marks the beginning of a rally lasting over 300 days,” trading account CryptoAmsterdam stated on platform X, sharing a comparative chart of Bitcoin bull market cycles.
Skew predicts a 'series' of new weekly closing records, as BTC/USD has attempted to fill the upper shadow line reached when hitting the historical high of $93,500 on November 13.
“BTC has just entered the parabolic phase of this cycle,” trader and analyst Rekt Capital stated, citing his own long-term BTC price analysis.
“Historically, this phase averages about 300 days. Bitcoin is currently only on the 12th day of the parabolic phase.”
Questions surrounding the Federal Reserve's next interest rate cut
This week, U.S. macroeconomic data is relatively quiet, but future financial policies may diverge.
Recent data shows that inflation accelerated in October, putting the Federal Reserve in a situation of 'stagflation' (i.e., rising prices and rising unemployment rates).
This has triggered differing opinions on whether the Federal Reserve will lower rates in December. According to the latest estimates from CME Group's FedWatch tool, the probability of pausing rate cuts stands at 35%.
“As we enter 2025, consumer expectations for lower interest rates are very high,” trading resource The Kobeissi Letter commented over the weekend.
“But now, the Federal Reserve seems to be abandoning expectations of a 'Fed pivot.' Although more rate cuts are on the way, inflation will remain high.”
Kobeissi noted that this week the earnings data from tech giant Nvidia will be released, which itself may serve as a catalyst for volatility in risk assets. Additionally, seven senior Federal Reserve officials are set to speak.
Meanwhile, unemployment rate data will be released on November 21, with the Purchasing Managers' Index (PMI) and consumer confidence report to follow the next day.
“The Federal Reserve's top priority has always been to avoid a simultaneous rise in unemployment and inflation, as seen in the 1970s,” Kobeissi added, sharing a chart of the consumer price index (CPI) compared to unemployment rates.
“Did the Federal Reserve fail to avoid stagflation again?”
Whales continue to accumulate BTC, ETF fund flows are complex
This month, the significant accumulation of Bitcoin by whales and institutional investors has become an important factor supporting the bullish view.
As Cointelegraph reported, with BTC/USD breaking historical highs and entering the price discovery phase, whale buying has not stopped.
On-chain analytical platform CryptoQuant's data confirms that both large whales and small whale entities continue to increase their BTC holdings.
In terms of U.S. spot Bitcoin exchange-traded funds (ETFs), the trend is similar.
“Since the launch of the Bitcoin spot ETF in January this year, the holdings have significantly increased from 629,900 BTC to 1,054,500 BTC, an increase of 425,000 BTC,” CryptoQuant writer MAC_D wrote in a Quicktake blog on November 18.
“This corresponds to an increase of 3.15% of the total supply (19.78 million BTC) to 5.33%, growing 2.18% in just eight months.”
MAC_D stated that the impact of this supply and demand dynamic should drive prices higher.
“Significant price increases in March and November indicate a strong correlation between accumulation and price,” the article added.
“Therefore, as Bitcoin accumulates through the spot ETF, we can expect prices to continue trending upwards.”
Data from investment firm Farside Investors, including from the UK, shows that spot ETFs are in a state of flux, with significant net inflows last week followed by noticeable net outflows.
In the two days leading up to November 15, the total net outflow exceeded $750 million, prior to Bitcoin soaring to new historical highs.
The 'FOMO' in the crypto market brings price warnings
Research shows that crypto social media 'very reliably' marks the peak of each BTC price rally.
Related: Bitcoin breakout or black swan? The $90,000 BTC price lacks historical highs in gold and stocks
By analyzing the volume of social media discussions around specific terms (such as price), research firm Santiment stated that the 'hype' around the future will peak alongside the price increases themselves.
“Bitcoin's astonishing rise has now reached a new historical high of $93,490,” the company stated on November 13.
“The hype on social media platforms reliably marks the top, with the most significant signal appearing four hours ago, when discussions about BTC prices above $100,000 surged.”
Santiment added that large-scale 'FOMO' signs should be viewed as a 'warning signal,' suggesting that market gains may reverse.
The latest reading of the crypto fear and greed index shows 'extreme greed' levels not seen since the long-term peak of Bitcoin in March.
The index reached 90/100 on November 17, just 5 points shy of the typical market reversal zone.
