The total market capitalization of all 10,800 existing cryptocurrencies fell 2.8% on Monday as Bitcoin lost over 2.4% in the past 24 hours. Meanwhile, bitcoin shorts are rising again after bitcoin shorts hit a two-year high on the Bitfinex futures exchange on June 25.
Bitcoin shorts rise higher
Bitcoin (BTC) and the digital markets in general have seen better days as BTC hit an all-time high above $ 64,000 trading three months ago, but has still fallen 48.66% since then. Roughly 17 days ago, the number of BTC / USD short positions on Bitfinex soared to levels not seen since June 17, 2019.
About 20 days ago, at $ 28,600 per coin, BTC hit its lowest price in quite a while, and today the cryptocurrency is only 13.72% above that low price. After the rise in shorts on June 25th, things settled down on June 27th and shorts remained low. Today, however, the short positions held on Bitfinex are starting to rise again and some viewers believe this is a bearish signal.
At the time of writing, the BTC / USD shorts on the Bitfinex derivatives exchange have risen to at least half of their June 25 high. Over 13,600 BTC / USD shorts were recorded while the BTC / USD long positions on Bitfinex topped all of the 2019-time highs.
51,000 Bitcoin long positions are hoping for a quick pump
Over 51,100 long positions on the exchange have been played so far on Monday and both longs and shorts continue to rise. The number of long positions does not necessarily give a bullish impression either, but it does show a certain optimistic mood, with market participants hoping for a future increase.
The Ethereum short position chart pattern is a little different from Bitcoin’s as the shorts have risen lately but have also started to decline today. ETH / USD long positions also show a different path than BTC’s current long records on Bitfinex as the ETH / USD long positions on the derivatives exchange are low on Monday.
Etoro market analyst Simon Peters attributes much of the carnage in the crypto market to the problems with mining digital currencies in China and the regulatory climate worldwide.
“Both crypto assets (BTC and ETH) have been hit by crypto breaches in China and regulatory changes in various jurisdictions around the world,” Peters said on Monday in a note on Bitcoin.com News.
The bitcoin outbreak will come, just not now.
– As I said yesterday, the bitcoin shorts continue to rise.
– No onchain outflows worth mentioning.
– $ 31,000 & $ 36,000 main level.
They don’t need to be hacked up, patience pays off.
– Joseph Young (@iamjosephyoung) July 12, 2021
The number of BTC / USD shorts cannot be considered bearish either, as a short squeeze could be in the cards. A short squeeze in the BTC / USD markets is not uncommon and, when it happens, triggers an extremely fast pump that leaves short sellers in the dust and land of liquidations. Typically in the world of Bitcoin trading, short squeeze occurs when there is an unusually high number of BTC / USD short positions.
The same can happen to those who play longs in what is known as a “long squeeze”. Similarly, a significant and sudden loss in value of Bitcoin will lead to panic selling and longs will also need to be liquidated.
What do you think of the current surge in short positions and the currently significant long positions? Let us know what you think on this matter in the comments below.
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