Bitcoin Hits Record High Daily Close as Futures Basis Signals Unusual Market Behavior

December 12, 2024 — Bitcoin (BTC) surged to a new milestone on December 11, achieving its highest-ever daily close as the cryptocurrency’s price action continues to defy expectations. BTC closed at approximately $101,200, marking a significant rebound from local lows earlier in the week, and setting the stage for a potential new all-time high in the coming days.

Bitcoin Price Sets New Record

Data from Cointelegraph Markets Pro and TradingView confirmed that BTC/USD closed at its highest point in history on December 11, surpassing the previous record of $101,200 set just a few days prior on December 8. This solid close comes after Bitcoin bounced back from recent dips, with the price having briefly dropped to around $94,000 earlier in the week.

Michaël van de Poppe, a trader, analyst, and entrepreneur, took to X to highlight the crucial support levels for Bitcoin, which have remained intact throughout this recent price action. He stated, “If the markets stay above that area, it's likely that we'll see new all-time highs in the coming days.”

Market analysts are increasingly optimistic, noting that Bitcoin’s latest ascent to six-figure levels is accompanied by ongoing market stability. As Charles Edwards, founder of Capriole Investments, pointed out, Bitcoin's new record close is happening with relatively low funding rates and little leverage in the market. “Bitcoin quietly just had its highest daily close ever,” he remarked on X. He also noted that Bitcoin exchange-traded funds (ETFs) have seen consistent inflows, further supporting the bullish narrative.

Leverage Cleansing and Market Stability

The latest BTC price surge comes after weeks of market volatility that have led to the liquidation of leveraged positions, especially those betting against Bitcoin. Data from CoinGlass revealed $270 million in crypto liquidations in a 24-hour period, with many shorts feeling the heat as Bitcoin’s price rebounded strongly.

Zaheer Ebtikar, co-founder of Split Capital, pointed out that despite Bitcoin nearing its all-time highs, there is a noticeable absence of speculative risk in the market. Ebtikar observed the Bitcoin futures basis—the difference between spot and futures prices—remains unusually low, which is rare in a typical bull market where futures premiums can soar to over 30%.

The futures basis is a key indicator of market sentiment and risk. In typical bull markets, the basis reflects significant speculation about Bitcoin’s future price, with futures contracts often trading at a premium to spot prices. However, this time, the market is showing signs of caution, as evidenced by the unusual behavior of the futures basis.

Futures Basis at Historic Low

Ebtikar called the current futures basis “absolutely insane,” highlighting how Bitcoin’s futures market remains comparatively subdued despite the ongoing price rally. This could signal a more cautious outlook from traders, with less leveraged speculation and fewer bets on extreme price movements.

In typical cycles of bull markets, as Bitcoin nears all-time highs, the futures basis can swell, reflecting optimism and increasing risk appetite among traders. However, with the market now seeing low basis levels despite the strong rally, some observers believe that traders are taking a more measured approach to Bitcoin’s price action, wary of repeating past mistakes in highly speculative environments.

What’s Next for Bitcoin?

As Bitcoin continues to test new highs, market watchers are divided on the potential for further upside. While a new all-time high seems imminent, analysts are keeping a close eye on broader market dynamics, including the ongoing effects of reduced leverage and the behavior of Bitcoin’s futures market.

For now, the market is enjoying a rare combination of strong price movement, low speculation, and an influx of institutional capital through ETFs. If Bitcoin’s price action continues to stabilize and break through resistance levels, it could set the stage for an even stronger rally in the coming days.

The path to new all-time highs appears clear, but the market’s relatively low futures basis indicates a more cautious and measured approach, suggesting that Bitcoin’s rise may be driven more by fundamentals and institutional interest than by speculative frenzy.