Will the Bitcoin (BTC) Price rally be over-extended? One of the analysts opined that there is no way to know whether we are entering a large potential correction or a rally or a continuation. The recent $56,000 is considered to be the upper range of the bullish channel that has been guiding the BTC since July.

The Fear and Greed indicator points to how the metric will be able to sustain overbought levels for more than 3 or 4 weeks.  The Fear and Greed indicator makes use of trading volume, futures open interest, social metrics, and search data to evaluate how hyped the market is. It indicates whether the traders are overconfident or under confident.  Changes in these metrics will indicate a correction. While the BTC rally will continue, there will always be a correction at some point whether in weeks or months.

The rate of funding also known as the “funding rate” should be considered. Derivatives exchanges charge a fee to balance the risk between longs (buyers) and shorts (sellers) as the leverage differs. When there is a buying spree, the indicator goes up.

For as long as the buyers are confident, the rally will continue. When buyers are overconfident, even paying 1.5% or 3% in funding rate will not prevent them from going long on their leverage.

It also becomes important to differentiate between the “trap” and the “peak.” Those who are going by the charts should know how to differentiate between the trap and the peak.

Meanwhile, a lot of money is trying to get into Bitcoin from institutional buyers, when that happens 250k will happen quicker than most can imagine.

General Opinions:  Charts are to tell us about past actions, not the future, many are not aware that the bull run is over.  All coins have pumped massively and now they are getting trapped.  Situational awareness is the #1 aspect missing from the majority of BTC market participants.  Intellectual laziness is the problem of the majority of people.

Some are scared to buy BTC as they feel regulators are trying to kill it with regulation. It also looks like everyone is waiting for it to explode, but no one is buying.

Also, if you can imagine the rush to sell if we go from 50k to 250k in a parabolic move, there will not be as many whales left anymore.

However, there is no denying that It very much is possible to start from nothing and make it in this industry.