The almost 4% decline in the price of bitcoin on January 30 is due to a reduction in risk appetite ahead of the upcoming Fed meeting on Wednesday. There is no significant activity in the context of position insurance through options, Blofin Academy noted.
1/6. BTC was dipping at $22.7k before the upcoming FOMC meeting on Thursday, down more than 4% over the past 24 hours and well off its high Sunday near $24,000. The rise in investor risk aversion is one of the important reasons for the price drop. pic.twitter.com/dcGvNdxwer
— Blofin Academy (@Blofin_Official) January 31, 2023
Analysts pointed to the increased interest in buying weekly put options and the lack of demand for instruments with expiration in a month or more. They concluded that traders do not rule out a short-term pullback and do not bet on the formation of a large-scale movement in the short term.
The weakness of the first cryptocurrency is observed against the background of the strengthening of the US currency as part of the global deterioration in the conjuncture of risky assets. The dollar index returned above the 102 support.
Dynamics of the dollar index. Data: Blofin Academy.
According to experts who have assessed the range of options and open interest on various strikes, $23,000 is a significant level for Bitcoin. Ethereum, in their opinion, looks bearish – this benchmark is at around $1450, which is 10% below current levels.