Bitcoin Faces Selling Pressure and Volatility Ahead of Options Expiration

Bitcoin’s Price Movement

Bitcoin experienced selling pressure on Tuesday, dropping to an intraday low of $92,600 before recovering to $94,600. Market dominance decreased to 57.38% as long-position liquidations intensified the downward trend. As of 12:19 p.m., Bitcoin was trading 3.5% lower at $94,785, while Ethereum rose 1.5% to $3,431.

Market Analysis and Predictions

According to Vikram Subburaj, CEO of Giottus, Bitcoin’s dip to $92,600 was followed by a rebound due to potential profit-taking signaled by $500 million outflows from spot ETFs. The cryptocurrency market may see volatility in the short term with $9.4 billion worth of options set to expire this Friday.

Market Trends and Impact

Last week, Bitcoin hit a record high of $99,830 amid optimism surrounding regulatory changes under a new administration. However, other major cryptocurrencies like Solana, BNB, XRP, Dogecoin, Cardano, Tron, and Shiba Inu saw declines. XRP stood out with a 24% surge in the last 24 hours.

Market Response to Economic News

The broader cryptocurrency market faced a decline as the dollar index rose, driven by US President-elect Donald Trump’s tariff announcements targeting imports from Canada, Mexico, and China. A stronger dollar can reduce Bitcoin demand by tightening global liquidity and increasing costs for international buyers.

Technical Analysis and Future Outlook

Sathvik Vishwanath, Co-Founder & CEO of Unocoin, highlighted Bitcoin’s recent price movement, noting a correction trend despite increased trading volume. Key resistance and support levels were identified, with potential for significant volatility ahead due to options expiration and political uncertainties.

(Disclaimer: Any recommendations and opinions expressed in this article are solely those of the experts and do not reflect the views of The Economic Times)