Bitcoin (BTC) closed the week at around $41,400, reflecting a 5.5% decline compared to the previous week’s closing value of around $43,800. The price had a notable dip on Monday, hitting a weekly low of around $40,225 before staging a strong recovery and surpassing the $43,000 threshold on Wednesday and Thursday. Over the weekend, negative price movements brought the closing price to around $41,400, with the downtrend continuing until Monday the 18th, when BTC broke below the $41,000 trading level.
Last week marked the first example of a weekly price decline after eight consecutive weeks of price appreciation, signaling expected market moves aimed at reducing market leverage. During the week, approximately $345 million of long and short positions were liquidated, with the majority of liquidations involving long positions, totaling approximately $235 million. However, the strong upward price movements seen at various times during the week also led to approximately $110 million in liquidation of short positions.
High volatility is a typical outcome after periods of significant up and down trends, which trigger a cascade of liquidations that reduce market leverage and contribute to a more sustainable price action and market environment. Traders often take advantage of moments of increased volatility to attract liquidity and adjust their positions.
Bitcoin’s dominance, which represents the market cap relative to the entire digital asset market, fell to 53.11% from 53.46% the week before, highlighting the robust resilience of altcoins compared to the leading digital assets during the recent downward trend. This indicates active investor involvement, as this pattern typically occurs when investors quickly allocate capital among several altcoins in search of short-term profitability.
An analysis of daily volume on centralized exchanges, measured over a seven-day period from November 11 to 17, revealed daily volume of more than $36 billion. This represents the highest level since March 2023, confirming strong trading activity contributing to increased volatility.
Looking at the ETF topic, the Grayscale Bitcoin Trust (GBTC) discount and Grayscale Ethereum Trust (ETHE) maintain a stable discount, 9.9% and 13.7% respectively. This underlines the unchanged confidence among investors about the likelihood of ETF spot approval and subsequent conversion of Grayscale trusts to ETFs.
The final deadline for the SEC decision on the 21Shares BTC Spot Filing is scheduled for January 10, with the comment window closing on January 5. In the six-day period from January 5 to 10, the SEC is expected to issue a final approval or rejection for the 21Shares filing, coinciding with a cascade of approvals or rejections for other BTC filings. Analysts continue to predict a 90% probability of a green light from the SEC.