Bitcoin rally hopes wane as professional traders turn bearish, retail stakes at 12-month lows

Bitcoin (BTC) has been stuck in a symmetrical triangle for 56 days and the trend change could last until early May, according to price technical data.

Currently, the support level is at $38,000 while the daily close triangle resistance is at $43,600.

Bitcoin mining up, retail interest down

Bitcoin/USD price at FTX. Source: TradingView

The week started with a positive performance for the Bitcoin network as the Lightning Network’s capacity hit an all-time high of 3,500 BTC. This solution enables extremely cheap and direct transactions on a secondary layer, also known as off-chain processing.

After cryptocurrency mining activities in China were banned in 2021, publicly traded companies in the United States and Canada drew most of this processing power.

As a result, Bitcoin’s hash has recovered dramatically since the summer. It currently stands at a record high of over 200 EH/s. According to the Cambridge Bitcoin Electricity Consumption Index, 45% of the global hash rate comes from North America.

In addition, Whit Gibbs, the founder and CEO of Compass Mining, stated that “public mining companies definitely have an advantage when it comes to holding Bitcoin because they have access to the capital markets.” In addition, there is less selling pressure as miners’ reserves are steadily increasing.

Search worldwide for the term “Bitcoin”. Source: Google Trends

Meanwhile, searches for “Bitcoin” on Google are approaching their lowest level in 12 months. This indicator could partly explain why Bitcoin is 41% below its all-time high of $69,000, i.e. public interest is low. Still, one has to analyze how professional traders position themselves, and there is no better measure than derivatives markets.

Still, one has to analyze how professional traders position themselves, and there is no better measure than derivatives markets.

Related: Crypto Miner Hut 8 Posts Record Sales As BTC Holdings Rise 100%

Long-to-short data confirm lack of excitement

The top traders long-to-short net ratio does not take into account external factors that may have affected specific derivative instruments. By analyzing the positions of these top spot clients, perpetual contracts and forwards, one can better understand whether professional traders are bullish or bearish.

There are occasional methodological differences between different exchanges, so viewers should keep an eye out for changes rather than absolute numbers.

Exchange’s top traders Bitcoin long-to-short ratio. Source: Coinglass

Bitcoin may be up 8% since March 13, but professional traders have not increased their bullish bets according to the long-to-short indicator. For example, the ratio of the top traders of Huobi fell slightly from 1.10 to the current level of 1.06.

In addition, OKX data shows that traders have reduced their long positions from 1.26 to 1.03 and significantly reduced their long position. Binance was the lone exception as top traders increased their long positions from 1.05 to 1.13. Nevertheless, there is a slight drop of 0.06 on average on the three main exchanges.

Can the triangle break upwards?

From the perspective of the statistics discussed above, there is hardly any sense that Bitcoin price will turn bullish in the near term. Data suggests that pro traders have reduced their long positions, as evidenced by the base rate and long-to-short ratio.

In addition, the broader Google search trend indicates that retail interest is not growing, despite high inflation data and global socio-political uncertainties. For now, the chance that the symmetrical triangle will break for the top seems small.

The views and opinions expressed here are solely those of the writer and do not necessarily reflect the views of Coin-Crypto. Every investment and trading move involves risks. You should do your own research when making a decision.

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