Bitcoin is currently trading at around $38,200 as it pulls back slightly after blasting past $40,000 during late trading on Thursday, January 7. At current prices, the asset is up 33% since the same time last week and it still doesn’t look like it is ready to correct yet.
Looking at centralized exchange movements could indicate when the inevitable correction will occur and eToro’s Mati Greenspan has observed that Bitcoin volumes across exchanges have just doubled its previous all-time high.
Other metrics indicate that there has been an increased inflow of BTC to centralized exchanges which could be a precursor to a heavy selloff.
Bitcoin has doubled in price since December 15, 2020, when it first traded above its previous all-time high. Messari founder Ryan Selkis observed that Bitcoin’s doubling time, which measures the speed of parabolic moves, has only been faster twice in 2013 and once in December 2017;
Sharp pullbacks usually follow these swift doublings of price. It stands to reason that when the market correction does come, it will be fast and furious as profits are cleared off the table in preparation for buying back at lower levels.
Civic CEO Vinny Lingham remains bullish stating that retail traders are more cautious this time around;
“Bitcoin at $40k and no bubble in sight. Traders that got burnt and left in 2018 are just coming back in. They’ll be more cautious. It’s the wave after that, incl. institutions that will create the peak of this new bubble/bust cycle. We still have time before it peaks.”
Trader Josh Rager on the other hand continues to warn of a 30% or even a 50% correction that could drop prices back to $20k in a very short time. Long term outlooks, such as those lofty predictions by JP Morgan strategists, are still very bullish.
With total market capitalization still near its highest ever levels and remaining over $1 trillion, things are still very healthy despite today’s altcoin slide.
Some of this week’s top performers such as Cardano and Stellar are dumping hard today, but they’re still a long way up from their prices this time last week.
Bitcoin and altcoins may be moving back to centralized exchanges but a major market-wide selloff has yet to initiate.