Bitcoin prices trading higher or lower than global spot market values usually signal that something could be amiss. In this case, a Bitcoin correction has been predicted by analyzing the Korean “Kimchi” premium and the COINBASE negative premium.
Bitcoin prices have retreated by 11.5% since their ETF-induced 21-month peak of $48,500 on January 11. However, this was largely expected by most analysts, and further signals suggest a larger market correction could be imminent.
Bitcoin Correction Chances
On January 15, on-chain analytics provider CryptoQuant reported that the Bitcoin Korea Premium Positive and the Coinbase Premium Negative suggested a short-term correction.
The analysts added that there have been three such signals in a row since mid-December. In late December, BeInCrypto reported that the Kimchi premium was signaling a local market top. BTC has tested resistance above $47,000 several times since then and failed to break through.
Moreover, the analysts observed increased deposits into Bitcoin exchanges by whale investors and miners. This, in addition to some selling of Grayscale Bitcoin Trust shares, is:
“Increasing the likelihood of a pullback and sideways movement in the near term, rather than a price increase.”
On January 15, BeInCrypto reported that there could be another big leverage flush on derivatives exchanges such as Binance. This could result in a 20-30% correction, pushing BTC prices back below $40,000.
Bitcoin is currently trading flat on the day at $42,843 at the time of writing. Furthermore, it has remained sideways since its weekend fall to this price level.
The asset made a move above $43,000 in late trading on January 15, but it was unsustainable.
Aside from the brief spike on the ETF approval news, BTC has been in a sideways chop since the beginning of December.
There is currently solid support around the $37,000 price zone, which would be a 24% correction should it materialize.
