After the price of Bitcoin bounced down from the mark of 52000, it continues to decline. Bitcoin price dropped below 48000 and is trading around 47600 at the time of publication.
On the 4-hour chart, the BTC/USD pair is trading in the range of 52000 – 45800. As the BTC/USD pair dipped below the support 48000, it is heading towards the lower boundary of the range. Then, BTC/USD pair will again test the support area of 46000-45800.
The BTC/USD pair is under the influence of expiring options. This Friday, 129,8 thousand option contracts expire. The estimated value of these contracts is $6 billion. However, analysts say that increased volatility is a common occurrence that occurs on the eve of the options’ expiration date. The analyst predicts a rise in the price of Bitcoin in January. Bitcoin price has already reacted to the upcoming options expiration date and the price is unlikely to show a deep decline until the end of this year.
If the decline continues, the level of 47500 will provide support for the BTC/USD pair. Further, the BTC/USD pair may receive support in the area of 47200. A breakdown of this level downward will send the BTC/USD pair to the area of 46300. Further, the pair will demonstrate an upward rebound.
If the bulls try to get the BTC/USD pair back above the level of 48000, they will also have to overcome the 48200 level to keep the pair above 48000. The next key resistance could be 48500. A break above this level will allow the BTC/USD pair to rise to the area of 49300.