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Traders still expect $80K for bitcoins

Even though bitcoin’s price is approaching resistance, and is currently trading 7.75 percent below its all-time high. Data from derivatives shows that professional traders are still aiming for $80,000. Choosing a timeframe for technical analysis is always a complex topic. However, in general, the longer the trend, the more likely it will prevail. Looking at the 3-day Bitcoin chart, one can see an ascending channel pattern that began in late June.

Bitcoin has reached new all-time highs. However, Bears will always find ways to justify their positions. BTC hit a record high in the aftermath of the United States’ consumer price surge to 6.2 percent. This is the highest inflation rate in 30 years. 

Long-term investors have stopped net accumulating and are now diversifying into alternative cryptocurrencies. The recent net selling from that group was the first in six months, indicating a “sell into strength” move.

From a trading standpoint, this creates the possibility of a “sell the news” event because the community widely anticipated the improvement.

Data shows pro traders are neutral-to-bullish

The futures basis rate can use to determine whether professional traders are bullish or bearish. This indicator, also known as the futures premium, is the difference between longer-term futures contracts and current spot market levels.

An annualized premium of 5% to 15% expect in healthy markets, a situation is known as contango—this price disparity by sellers demanding more money to postpone settlement for a longer time.

Options traders

Futures-specific externalities, options markets should investigate. The delta skew of 25% compares similar call and put options. When fear is prevalent, the metric will turn positive because the premium for protective put options is higher than comparable risk call options.

When greed is predominant, the 25 percent delta skew indicator shifts to the negative area. A skew indicator of -8 percent (desire) to +8 percent (fear) is neutral. The last time that indicator moved outside of this range was on September 29, when it reached +10 percent.  

The current neutral 25 percent delta skew could be interpreted as a “glass half full” because professional traders appear unfazed by the 95 percent gains year to date.

Data shows room for additional leverage from Bitcoin buyers, ideally seeing the price remain within the ascending channel established in late June.

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