Bitcoin Pro Traders Side-eye Breakouts To $92K

Main takeaways:

• Economic uncertainty, a delayed jobs report, and a weak housing market are causing traders to pull back from Bitcoin.

• Professional traders incur high costs to protect against falling Bitcoin prices, while in China, stablecoins are sold at a discount to exit the cryptocurrency market.

Bitcoin (Bitcoin) faced a pullback of $2,650 after failing to break the $92,250 level on Monday. The move followed a reversal in the US stock market amid uncertainty and growing anxiety about labor market conditions Extended evaluations In artificial intelligence investments.

Traders now await the US Federal Reserve’s monetary policy decision on Wednesday, but the prospects for a quick recovery to $100,000 depend on risk perception.

The monthly premium of Bitcoin futures compared to spot prices (base price) has remained below the neutral 5% threshold over the past two weeks. The weak demand for bullish leverage reflects Bitcoin’s 28% decline since its all-time high in October. However, concerns about global economic growth also weighed on sentiment.

Official US government data on employment and inflation were delayed due to a 43-day funding shutdown that ended in November, reducing visibility into economic conditions. As a result, the consensus is around 0.25%. Reducing the interest rate The unemployment rate in December was not enough to spark optimism, especially after the special jobs report showed that 71,321 employees were laid off in November.

Additional pressure came from the US real estate market after Redfin Data The report showed that 15% of home purchase agreements were canceled in October, due to rising housing costs and increased economic uncertainty. Furthermore, CNBC reported that delistings were up 38% from October 2024, while the average list price in November was down 0.4% from a year earlier.

Bitcoin has underperformed the stock market, indicating risk aversion

Bitcoin’s decline to $90,000 accelerated after the aggressive liquidation of $92 million worth of bullish leveraged Bitcoin futures contracts. The weak macroeconomic outlook may have weighed on Bitcoin trader sentiment, but the S&P 500 remained just 1.2% below its all-time high of 6,920 points.

Whales and market makers are demanding a 13% premium for selling Bitcoin put options on Deribit. The inflated cost of downside protection is typical of bear markets. However, the rejection at $92,000 on Monday did not affect traders’ positions, strengthening the $90,000 support level.

Traders also retreated from China’s cryptocurrency market as stablecoins traded below parity against the local currency. This risk aversion signal supports Bitcoin’s short-term bearish outlook, but does not necessarily mean that traders expect prices to fall to $85,000 or lower.

Under neutral conditions, USDT should trade at a premium of 0.2% to 1% to the official US dollar rate to compensate for cross-border frictions, regulatory hurdles and related fees. The discount relative to the official rate indicates strong exit demand from cryptocurrency markets, a pattern often seen during bearish phases.

the Lack of inflows The entry of Bitcoin exchange-traded funds (ETFs) into the US over the past two weeks has also impacted demand for bullish exposure. Bitcoin’s ability to reach $100,000 in the near term will depend largely on improved visibility in the US labor market and real estate conditions, which may take longer to develop than a single Fed decision.

Related to: Bitcoin Buries Tulip Myth After 17 Years of Proven Resilience, ETF Expert Says

This article is for general information purposes and is not intended and should not be taken as legal or investment advice. The views, thoughts and opinions expressed herein are those of the author alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.