The price of Bitcoin did have quite a mixed reaction on the 9th of December after the report from November on the producer prices in the country showed an increase of 7.4% as opposed to the previous year. The data also went on to suggest that the wholesale costs would be continuing to rise and the rate of inflation could possibly last a lot longer than all the investors have been planning to do.
The oil prices also seem to be a focal point of contention for investors, with the crude WTI hitting a new yearly low at around $71.10 on the 8th of December. The United States Dollar Index, which is a measure of the strength of the USD against a basket of top foreign currencies definitely sustained the level of 104.50, but the index did trade in at 104.10- which is a 5-month low on the 4th of December.
The Price Of Bitcoin Could See A Difficult New Year
Several traders also went on to note that the choppy activity by the price of Bitcoin did leverage longs and shorts to be liquidated, but it was then followed up quite a failed tentative dump below a price of $17,050. According to this analysis, the stagnation regarding open interest forums on futures contracts does indicate quite a low confidence from the market bears.
It is understood that regulatory uncertainty could also be playing an important role in limiting the upside of the cryptocurrency. On the 8th of December, the SEC issued new guidance that could see publicly traded companies disclose their exposure to crypto assets.
In order to remain risk-averse, traders should start analyzing the options markets to understand if Bitcoin will actually succumb to the bearish newsflow. The delta skew around 25% is always a telling sign whenever the market makers and the arbitrage desks start overcharging for downside and upside protection.
