(DAILY NOTION): BTC/USD: Bears Taking the Reins, Are the Bulls Completely Out of the Picture? Next Mover: Market Reaction to Biden Stimulus Package

Source: Yahoo Finance

Is the BTC/USD bull run over? The flagship cryptocurrency took a sharp dip to $29,300 in the early hours of the Asia session. Other than being its lowest point since Jan 4, this also means that BTC/USD has now dipped 30% below its all-time high of $42,000.

The Relative Strength Index (RSI) is signalling a strong oversold condition at 18. The RSI had experienced a rather sharp decline from 74 to its present level, a staggering 76% dip.

According to analyst Lorenzo Stroe, a symmetrical triangle was formed on the four-hour chart with a price target of $27,200. Peter Brandt, a veteran trader, and analyst also believes that BTC/USD could reach $27,290. However, he believes that this is a healthy correction after an incredible bull rally.

While the recent bull run has triggered a sense of FOMO, or fear of missing out, in the market, one cannot help but wonder if this recent dip would trigger a bout of panic-selling in the market? At the same time, as markets anticipate the progress of the Biden stimulus package, can a higher risk-on sentiment in the market power the BTC/USD bulls more?

As the digital gold surged gloriously upwards in recent weeks, the U.K. financial watchdog had issued a warning this month that cryptocurrency investors should prepare to lose all their money. At the same time, large U.S. financial institutions have been including BTC/USD into their portfolio. Grayscale Investments are also using the opportunity during this latest dip to add 8,000 BTC into their portfolio.

At the end of the day, it is always important for traders to have a sound risk management strategy when trading. This can help to ensure peace of mind, whether in a bull or bear run.

BTC/USD (as of Jan 22, 2021, 9.50 a.m., GMT +8) - $30,106.68

FOLLOWME BTC/USD User Sentiment (as of Jan 22, 2021 at 10.20 a.m.)

Short – 35.47%

Long – 65.43%