After returning from short-term lows, Bitcoin (BTC) rose 15% in three days, rising from $ 32,400 to $ 37,200.
This was a great move given that the price of BTC has been trading sideways for several weeks, and whatever the reasons for the increase, one would expect the major traders and arbitrage services to follow this trend.
Interestingly, this is not the case, as many of the best traders were selling short positions when BTC started its 15% move. Although the trader is unsure whether the all-time high of $ 42,000 will be revisited, it is being sold while Ether (ETH) is overtaking $ 1,600.
Bitcoin and Ether prices are in USD on Bitstamp. Source: Data on digital assets.
Keep in mind that both major cryptocurrencies tend to trade together most of the time, although investors may switch from BTC to Ether due to their role in decentralized financing, higher rates and the investment attractiveness of Eth2.
Data from alternative social analysis company TheTie also showed that Google searches for “buying cryptocurrencies” have recently reached record levels. According to the same source, there has been a 135% increase in cryptocurrency activity on social media in the past three months.
In addition to this upside scenario, global payments company Visa announced that it is aggressively developing partnerships with cryptocurrencies, including debit cards and digital banks.
Finally, CryptoQuant analysts called the recent flow of 15,200 BTC ($ 515 million) into Coinbase a “optimistic sign.” According to CryptoQuant, the outflow refers to an “OTC transaction by institutional investors” that can store BTC in cold wallets.
These bullish signals contradict the proposed net position of the exchange for traders from buying to selling. This indicator is computed by analyzing the consolidated immediate client position, permanent and futures contracts, and provides a clearer indication of whether professional traders are leaning in an upward or downward direction.
With this in mind, there are inconsistencies in the different exchange styles from time to time, so viewers should keep track of changes, not absolute numbers.
The relationship between long and short BTC positions among the major traders. Source: Bybt.com
Over the past three days, the top traders on each exchange analyzed have increased their short positions. While major traders, market makers, and arbitrage services may have positions in their cold portfolio or gray scale GBTC funds, the long to short ratio shows that there is no certainty if BTC can beat the $ 38,000 and reach the 40,000 level. Short term.
Additionally, Ether’s superiority may be due to the fact that major traders have downplayed bitcoin’s risk. That makes more sense given that the upcoming CME ETH listing will take place on February 8th. It is natural that there is an increase in appetite among institutional investors.
The best traders may have pulled their bitcoins off the stock market as well, looking for opportunities for higher returns, so it is a snap to assume that they’ve all hit the trade.
If these really big traders fail in BTC, there will be signals in the derivative markets. To refute this theory, Friday’s $ 1 billion expiration is still in favor of the bulls, who currently have plenty of incentive to push the price above $ 40K.