Price analysis 1/11: BTC, ETH, XRP, LTC, BCH, ADA, DOT, LINK, BNB, XLM – BTC Ethereum Crypto Currency Blog

January 11, 2021 by No Comments

Bitcoin’s sharp correction may not have broken its uptrend, but several altcoins have signaled that a short-term top could be in place.

After an incredible run-up to nearly $42,000, Bitcoin (BTC) price finally entered a significant correction, and at the time of writing the price is down by about 18%. While the swift drop to $30,402 may not induce sleepless nights from the HODLer crowd, large drops like the one seen over the past 24-hours can easily blow up a leveraged trader’s portfolio. The sharp downside move also threatens to wipe out a large portion of the gains accrued over the past few weeks.

Data from Bybt indicates that over $2.7 billion worth of futures contracts has been squared off in the past 24 hours.

Once traders in long positions start getting liquidated due to margin calls, traders who have been waiting to buy withhold their purchases as they expect an even better opportunity to buy at a bargain. This lack of demand and excess supply trigger steep falls like the one seen today.

Daily cryptocurrency market performance. Source: Coin360

Similar to how resistance levels fail to stall a rally backed by strong momentum, during panic selling, support levels fail to arrest the decline. Professional traders usually do not step in to catch a falling knife. They prefer to wait for the excess froth to clear and the selling to subside before jumping in to buy.

Let’s study the charts of the top-10 cryptocurrencies to identify the levels that may act as strong support.