Bitcoin Faces New Price Targets as Liquidations Lead to Market Decline
Bitcoin (BTC) has new BTC price targets to reckon with as a cascade of liquidations take crypto markets lower. Thanks to regulatory enforcement action by the United States Department of Justice, largest global exchange Binance is in line for a major fine. Its CEO, Changpeng Zhao, informally known as CZ, will be forced to quit his post and may even face jail time.
This was a watershed moment for one of the crypto industry’s household names, and markets reacted with arguably understandable concern. BTC/USD fell to $35,600, per data from Cointelegraph Markets Pro and TradingView — its lowest levels since Nov. 16 — before rebounding thanks to short positions closing.
Altcoins fared worse, and at the time of writing, many large cap tokens remain 3-5% lower on the day.
What could happen next and how are Bitcoin market participants preempting volatility?
Cointelegraph takes a look at some of the popular BTC price targets now in play.
“Max pain” BTC price is now $32,000
Forget about a “quiet” week in crypto — the Binance bombshell has put an end to boring Bitcoin trading, says James Van Straten.
In a reaction, the research and data analyst at crypto insights firm CryptoSlate warns that volatility catalysts will keep coming.
This is thanks to a giant $3.8 billion or 104,000 BTC options open interest expiry event the day after the U.S. Thanksgiving holiday, potentially adding fresh fuel to an already nervous market environment.
Thanks to their composition, Van Straten says, the most punishing BTC price drop would now be one to $32,000.
“With the put/call ratio standing at 0.77, the data indicates a predominantly bullish sentiment, as substantiated by the higher call open interest, approximately 58,000 Bitcoin, compared to the 45,000 Bitcoin put options,” he writes. “What catches the eye is the ‘max pain price’— a significant metric in the options market — pegged at $32,000, a figure that is currently below Bitcoin’s market price. This suggests a potential pressure on the Bitcoin price as the expiration date nears.”
Bitcoin options open interest by strike price chart. Source: Deribit
Van Straten adds that while options figures “indicate an expectation that the price was anticipated to hover around these levels,” Bitcoin would still be bullish were the $32,000 scenario to become reality.
“The bull market thesis would still be intact,” he told X subscribers.
Betting on the “Notorious B.I.D.”
Analyzing order book composition, on-chain monitoring resource Material Indicators is also predicting a slide closer to $30,000.
This was already on the cards, with analysis arguing that Bitcoin should retest areas of bid liquidity after its swift ascent to 18-month highs of nearly $38,000.
A snapshot of BTC/USDT after the Binance news shows bids moving up the order book closer to spot price in order to halt further downside.
“The order book also shows nervous sellers moving asks down to front run $38k, but that could change if bulls can gain enough momentum to reclaim the 21-Day MA. If they fail to do so, I expect to grind lower,” Material Indicators explained at the time.
It referenced the 21-day simple moving average (SMA), which now stands at $36,228 — so far once again below spot.
BTC/USD 1-day chart with 21SMA. Source: TradingView
Ultimately, it summarized, a patch of bid support at $33,000, which is becoming known as the “Notorious B.I.D.,” must hold.
“$35k feels looks like a viable target from here,” the analysis concluded. “In full disclosure, I really want to see a retest of $33k fail, but I’m not sure Notorious B.I.D. is going to let that happen yet.”
BTC/USDT liquidity data. Source: Material Indicators/X
Binance withdrawals stay modest
As Cointelegraph reported, various bearish Bitcoin forecasts have surfaced this month, even prior to the Binance announcements.
These include a $30,900 floor as part of a broader BTC price channel which has yet to be exited by bulls.
Commenting on the market’s reaction overnight, meanwhile, the trader behind it, CryptoQuant contributor Gaah, noted a lack of sustained stablecoin withdrawals from Binance as a result.
Earlier this year, concerns over liquidity and a regulatory crackdown at the exchange sparked mass withdrawals of funds.
Despite the stepping down of CZ, Binance’s CEO, in the last few hours there have been no significant outflows of BTC or Stablecoin from Binance.