Bitcoin

3 Key Metrics Show Bulls Control Bitcoin Price Even Though Not Hitting $ 12,000

Bitcoin (BTC) price fell up to 10% this week And while this may scare day traders, the 3-day chart shows it The downward movement had hardly any impact on the current market structure.

This is especially true considering that the USD 12,500 level has not been reached in more than 13 months. Indeed, Analysts set a price target of $ 16,000 partly due to a gap in the CME and the expectation of higher inflation in the United States.

Bitcoin 3-day chart in USD. Source: TradingView

3 Key Metrics Show Bulls Control Bitcoin Price Even Though Not Hitting $ 12,000
3 Key Metrics Show Bulls Control Bitcoin Price Even Though Not Hitting $ 12,000

Bitcoin 3-day chart in USD. Source: TradingView

The graph above shows how insignificant the last ten days of negative performance are from a broader perspective. Bitcoin (BTC) has seen a 48% gain so far and there is no evidence of weakness. The largest daily decline in the past five months was -6.4% on August 2nd.

The headlines aren’t concerned about the recent volatility

As short-term traders wonder if the August 28th expiration of CME futures and options caused the decline of recent days, The network’s data shows that the headlines have gotten stronger than ever.

1 year UTXO from Bitcoin. Source: LookIntoBitcoin

1 year UTXO from Bitcoin. Source: LookIntoBitcoin

63% of UTXOs haven’t been played in over a year. Those headlines were down 53% in the 30 days leading up to March 13, however Even the Black Thursday crash didn’t convince them to move their BTC.

The options markets show few signs of stress

Options markets provide us with the real-time sentiment of professional traders and arbitrage trading counters. The 25% delta bias is the leading indicator of “fear and greed” in the options markets as it measures the cost of hedging against a negative price swing versus a positive one.

Bitcoin 3 month options 25% delta offset. Source: Skew

25% Delta Bias of 3 Month Bitcoin Options. Source: Skew

These put options, give buyers the opportunity to sell Bitcoin at a later date at a fixed price, They’re currently 6% more expensive than a similar calling option. While this instrument is not as optimistic as the 13% price differential measured earlier this month, The 25% delta bias indicator can still be interpreted as bullish.

Top traders stay net over the long term

Some exchanges provide data on the long to short term net positioning of large traders. This is a great way to gauge whether professional traders are bullish or bearish.

Even if The individual futures markets are balanced between buyers (long-term) and sellers (short-term). The main traders’ risk is typically spread across several markets.

By adding the positions of these customers, Exchanges can determine the net exposure of top traders.

Top trader longs / shorts. Source: Binance, OKEx and Cointelegraph

The main dealer in the long / short term. Source: Binance, OKEx and Cointelegraph

The major Binance and OKEx traders have been optimistic since July 27th. Herself, that is an impressive achievement, Given the sharp drop in Bitcoin price from $ 1,500 on August 2nd.

Less settlement on the futures markets

By measuring the settlement of futures contracts during negative price fluctuations, it is possible to estimate how vulnerable buyers are (long term). Note that there has been 9% or more intraday price fluctuations four times in the past three months.

Bitcoin (USD). Source: Bitstamp  CoinTelegraph

Bitcoin (USD). Source: Bitstamp and CoinTelegraph

If these traders had been caught with leverage of 10 or more, they would have been forcibly liquidated a long time ago. Hence, the open interest in futures would decrease significantly.

Total open interest of BTC futures in USD. Source: Bitstamp and CoinTelegraph

Total open interest of BTC futures in USD. Source: Bitstamp and CoinTelegraph

Total open positions for BTC futures increased 166% over the past five months to $ 4.8 billion. These data give us more evidence that the recent negative move of 10% will not wipe out whales.

Every bull run has the occasional fix

We’ll certainly see some selling pressure as Bitcoin (BTC) consolidates after a bull run of 28% in the last two weeks of July. Even during the big three month bull run of 240% that began in early April 2019, there were four opportunities for short-term corrections of 9% or more.

However, both On-chain data like sentiment among major derivatives traders remains bullish. This suggests that the market will tend to move neutral or higher over the next two weeks.

The views and opinions expressed here are solely those of author and do not necessarily reflect the views of Cointelegraph. Every investment and business move is associated with risks. You must do your own research when making a decision.

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