Bitcoin (BTC) has recovered in the past two days after falling to $ 28,850. However, after a rapid rebound, BTC was unable to overcome the strong resistance of $ 33,000 on January 23 and fell below $ 32,000 at the time of writing.
BTC / USD hourly price table (Coinbase). Source: TradingView.com
Coinbase’s dividend yields are bullish, but now?
Previously, when the price of Bitcoin fell below $ 32,000, the trading price of BTC on Coinbase was much lower than on Binance.
Coinbase’s lack of rewards is of concern for two main reasons. First of all, due to Tether’s lower premium, Bitcoin naturally trades at a higher price on Coinbase.
Second, when Coinbase sees prices lower than other exchanges, it indicates that there is enormous selling pressure in the US market.
When bitcoin’s selling pressure in the US market started to increase, the price of BTC felt firm within a short period of time.
BTC / USD (white) vs Coinbase Premium (blue).
But after BTC’s $ 30,000 rebound, Coinbase’s value almost reappeared. At the time of writing this article, Coinbase’s BTC is $ 40 higher than Binance’s.
Coinbase’s premium will reappear in almost 12 hours, which is a positive sign of a possible trend reversal.
Signs of “institutional burnout”
But in the short term, this is all just optimistic. Analysts at QCP Capital, a team of Asian traders, saw several signs of “institutional exhaustion”.
Given that the most important recent narrative is institutional demand for bitcoin in the United States, if institutional demand for bitcoin slows, a rebound may be in danger. they said:
“Signs of Institutional Fatigue: We performed a time zone analysis to break down the BTC movement between Asian time and US time (every 12 hours). In March of last year, the obvious model was the continued acquisition of whales in the United States and sales to Asian Whale miners. ”
Bitcoin is gradually declining in the United States. Source: QCP Capital
Traders have found that for the first time, the power of trading hours in the United States has lost momentum.
In fact, most of the pressure on Bitcoin sales over the past week has come from Asia. This represents a major change in market sentiment. They added:
“After the highest BTC two weeks ago, the US hours force lost momentum for the first time. This clearly shows that demand from American institutions and businesses has been exhausted, and these institutions and businesses have been the main driver of this upward trend.
What’s next for Bitcoin?
If institutional demand for BTC declines, Bitcoin could be revised in the first quarter of 2021.
Various business-oriented platforms and tools (such as Grayscale) continue to generate significant traffic, indicating strong institutional demand. At the same time, MicroStrategy is continuing its policy of buying bitcoin per bath, with the latest purchase last Friday totaling $ 10 million.
“Today, $ 31,000 is a solid bag of support, so at least not everyone is selling,” said Chad Stinglas, head of trading at Crosstower, a digital asset capital market firm.
“We will have to wait and see if this wall continues to exist or if the system continues to be established. If so, this trend is likely to pick up and continue. If they are unwilling to take action. , wait for further regulatory guidance, then there will be a shortage of funds. ”
At the same time, if the overall demand for BTC accumulation in the US market continues to decline, especially if the US dollar continues to recover in 2021, a wider correction could still be made.