Bitcoin (BTC<\/a>) starts a new week on familiar ground below $50,000, but anticipation is building for major disruption to begin.<\/p>\n After a fresh push above $50,000 ended in rejection, BTC\/USD is keeping traders guessing till the last when it comes to near-term price action \u2014 including the end-of-year close.<\/p>\n With just two weeks to go, the kind of blow-off tops that characterized both 2013 and 2017 seems unlikely to repeat, but on-chain metrics are all but unanimously pointing to upside.<\/p>\n With 90% of the Bitcoin supply now officially mined, Cointelegraph takes a look at what could lie in store for investors this week.<\/p>\n Sunday was marked by a fresh push to $50,000 and beyond, which ultimately failed to hold, data from Cointelegraph Markets Pro<\/a> and TradingView<\/a>\u00a0shows.<\/p>\n It\u2019s a familiar story, and one that came as no surprise to seasoned market participants.<\/p>\n \u201c53K has been my line in the sand as well. Flip that and we\u2019re back in business,\u201d analyst William Clemente reiterated<\/a>.<\/p>\n While Bitcoin remains under a $1trillion asset sub-$53,000, other opinions were far from concerned about the unexpected sideways nature of the market this Q4.<\/p>\n For popular Twitter account TechDev, Bitcoin still \u201crhymes\u201d with previous bull cycle years and seems similar<\/a> to Q4 last year \u2014 right before BTC\/USD began its ascent.<\/p>\n #BTC<\/a> Weekly<\/p>\n About as much reason to be bearish here as there was in late 2020 before the first major leg in my opinion. pic.twitter.com\/62AptElE2G<\/a><\/p>\n \u2014 TechDev (@TechDev_52) December 13, 2021<\/a><\/p><\/blockquote>\n Elsewhere, PlanB, the creator of the stock-to-flow BTC price models, was also optimistic. Uploading a representation of one of his forecasts, he argued that Bitcoin had in fact just been in an extended consolidation phase for most of the year.<\/p>\n \u201cPatience is key,\u201d he added<\/a>.<\/p>\n This week\u2019s macro trigger comes in the form of the United States Federal Reserve and its next announcement on the state of its asset purchase program.<\/p>\n A meeting of the Federal Open Market Committee could provide valuable insights into the future of quantitative easing (QE) and the speed of \u201ctapering\u201d asset purchases.<\/p>\n Amid an inflationary environment and the ongoing risk of coronavirus fallout, the Fed faces an unenviable balancing act when it comes to the credibility of policies it chose to enact.<\/p>\n As Cointelegraph reported<\/a>, some are eyeing the meeting as being much more potentially disruptive to crypto markets than last week\u2019s Consumer Price Index data, which showed the highest U.S. inflation since 1982.<\/p>\n \u201cWith no opposition raised by other Fed officials, despite the uncertainty presented by the emergence of the Omicron variant, next week\u2019s meeting look set to see the Fed announce an acceleration in QE tapering, with a $30bn reduction for January (to $60bn of purchases) and a further $30bn reduction in February,\u201d a note<\/a> from banking giant ING read last week. <\/p>\n \u201cThis would mean the Fed wrapping up the programme by the beginning of March, leaving the Federal Reserve with $8.8tn of assets on its balance sheet \u2013 more than double its pre-pandemic January 2020 level!\u201d<\/p><\/blockquote>\n Major changes in QE effectively alter the availability of \u201ceasy\u201d money, in the words of BitMEX former CEO Arthur Hayes, and has knock-on effects<\/a> for risk assets such as Bitcoin.<\/p>\n It\u2019s no secret that on-chain indicators have stayed strong despite spot price decreasing nearly 40% versus all-time highs.<\/p>\n Now, more metrics have joined in, giving analyst Cole Garner some serious faith in \u201cgreen days\u201d ahead.<\/p>\n In a series<\/a>\u00a0of Twitter posts\u00a0over the weekend, the well-known statistician outlined several of his \u201cgo-to\u201d charts, which have now turned conspicuously bullish.<\/p>\n \u201cI think BTC is ready,\u201d he summarized about the outlook for BTC\/USD as a result. <\/p>\n \u201cSuddenly all of my favorite leading indicators are lining up long & strong.\u201d<\/p><\/blockquote>\n Chief among the signals was that coming from over-the-counter (OTC) trading desks. These entities\u2019 BTC balance saw a sudden increase last week, corresponding to buying activity among clients.<\/p>\n While not always corresponding to price increases, OTC remains firmly on Garner\u2019s radar as \u201cpowerful alpha.\u201d<\/p>\n \u201cOne of the very best leading indicators I\u2019ve ever seen. The more you think about it — the more it makes so much intuitive sense,\u201d he wrote. <\/p>\n \u201cIt\u2019s gone and flipped full bull.\u201d<\/p><\/blockquote>\n Another is the combined volume delta (CVD) for Bitcoin whales, this sloping upward in what Garner said is an infallible bull sign.<\/p>\n CVD is used to determine the ratio of buyers and sellers during market moves, and its data suggests that buyer interest likewise remains strong at current levels.<\/p>\n \u201cThis metric has evolved to be my go-to indicator, over the course of this bull,\u201d he commented. <\/p>\n \u201cIt does not lie.\u201d<\/p><\/blockquote>\n As ever, not everyone was convinced, with responses arguing that the spike in OTC numbers could be just that \u2014 a brief divergence in an overall downtrend. Others are sticking to a narrative that requires Bitcoin to end 2021 with a whimper<\/a>, slowly consolidating on the way to a return to the upside next year.<\/p>\n Continuing a previous trend, institutional investors show no signs of divesting themselves of BTC as a \u201crisk\u201d asset under current conditions.<\/p>\n Amid the OTC suspicions, fresh data<\/a> shows that exchange-traded funds (ETF) are busy accumulating and that demand is there for them to do so.<\/p>\n The Purpose Bitcoin ETF, Canada\u2019s first licensed spot ETF product for Bitcoin, added 4,342 BTC to its reserves in December, an increase of 17.6%.<\/p>\n Now with 28,974 BTC, Purpose shows what many have been arguing throughout the year \u2014 that Bitcoin exposure for institutional entities is a tide, which must be catered for sooner or later.<\/p>\n \u201cThat\u2019s just one ETF,\u201d Lex Moskovski, chief investment officer of Moskovski Capital, commented<\/a>.<\/p>\n The issue of the U.S. denying spot-based Bitcoin ETFs a market remains contentious, meanwhile, as industry representatives<\/a> and even lawmakers get in on pressuring regulators to explain their position.<\/p>\n \u201cCan anyone explain… why Fidelity Investments, one of America\u2019s best-known investment advisors, had to go to Canada to offer an ETF, or why physically-settled crypto ETFs are safe and legal in Germany, Brazil, Singapore and elsewhere, but somehow not in the United States?\u201d Brian Brooks, CEO of BitFury, told the Senate Committee on Financial Services in testimony<\/a> last week.<\/p>\n It may be that the market simply does not know what to think.<\/p>\n Related:\u00a02 key Bitcoin trading metrics suggest BTC price has bottomed<\/a><\/em><\/strong><\/p>\n If the Crypto Fear & Greed Index<\/a> is any guide, changes in Bitcoin\u2019s overall rangebound price activity are currently able to upend the mood with just a few thousand dollars up or down.<\/p>\n Fear & Greed has returned to the spotlight in recent weeks thanks to the unexpected nature of the BTC downturn.<\/p>\n Last week, it hit its lowest reading since July \u2014 16\/100 or \u201cextreme fear.\u201d It then almost doubled to 28\/100 in a single day before reversing back down to 16 \u2014 and then up to 27 \u2014 over the weekend.<\/p>\n Over that period, BTC\/USD acted within a range of around $4,000.<\/p>\n \u201cThis range has turned my Twitter feed into an emotional rollercoaster,\u201d analyst William Clemente joked<\/a> alongside a chart showing sentiment reactions to recent price moves.<\/p>\nSame, same but different?<\/h2>\n
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To taper or not to taper?<\/h2>\n
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Analyst Cole Garner: Bitcoin \u201cis ready\u201d<\/h2>\n
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Bitcoin ETFs galvanize their reserves<\/h2>\n
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\u201cEmotional rollercoaster\u201d<\/h2>\n
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