Key Bitcoin price metric signals traders are positioned for $50K BTC

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Bitcoin (BTC) value posted a 25% achieve after this week’s information of Tesla’s $1.5 billion BTC funding got here out. Previous to this reveal, BTC was lagging behind Ether’s (ETH) efficiency by 7.5% however the quite a few bullish occasions of the previous few days helped BTC to hit a brand new all-time excessive at $48,900.

Earlier to Tesla’s announcement, BTC value was buying and selling within the $30,000 to $41,500 vary for practically 3 weeks and as soon as the worth broke out one would anticipate professional merchants and arbitrage desks to observe the bullish development.

Fairly than flipping lengthy, most of the prime merchants opened quick positions as BTC commenced its 25% transfer. This appears dangerous provided that this week Bitcoin obtained praises from JPMorgan’s co-president and regulators approve a BTC ETF approval in Canada.

Bitcoin and Ether USD costs at Bitstamp. Supply: NYDIG Digital Assets Data

Historic information reveals that Bitcoin value actions are inclined to commerce in tandem with Ether, which has been strongly bullish for months. Including to this bullish situation, Bitcoin’s Lightning Network announced a record node count and the overall worth locked (TVL) surpassed $42 million.

Mastercard also announced that it would support cryptocurrency payments on its community by the top of 2021.

These bullish alerts distinction with the long-to-short internet positioning metrics offered by main cryptocurrency exchanges.

This indicator is calculated by analyzing the consumer’s consolidated place on the spot, perpetual and futures contracts and it supplies a clearer view of whether or not skilled merchants are leaning bullish or bearish.

It is very important notice that there are occasional discrepancies within the methodologies between numerous exchanges, so viewers ought to monitor adjustments as a substitute of absolute figures.

Change’s prime merchants BTC long-to-short ratio. Supply: Bybt.com

Since Feb. 8, when the Tesla announcement befell, exchanges’ prime merchants have saved their internet positions comparatively unchanged.

Earlier than Bitcoin’s 25% rally, Binance had a 1.33 ratio favoring longs, which is consistent with the earlier week. This indicator peaked at 1.53 on Feb. 10, however has since then returned to 1.31.

Alternatively, Huobi prime merchants had a 0.74 indicator forward of Feb. 8, which remained flat for 3 days. On Feb. 11 as BTC rallied from $44,000 to $48,000, these merchants started growing internet longs, reaching the present 0.80. Though this degree remains to be favoring internet shorts by 20%, it stays above the 0.75 degree from Jan. 29.

Lastly, OKEx prime merchants held a 14% internet lengthy place earlier than the Tesla information got here out. Though they’ve reverted to a 47% internet quick place on that very same day, during the last 4 days the indicator has come again to 1.03. At the moment, OKEx merchants stay effectively beneath the 52% internet lengthy place from two weeks in the past.

Staking may very well be capturing prime merchants

High merchants may have additionally moved their BTC off-exchange in quest of higher yield alternatives. Subsequently, assuming that they’ve entered quick positions solely by monitoring centralized exchanges’ may very well be a brash conclusion to succeed in.

As issues at present stand, the long-to-short indicator doesn’t present excessive internet lengthy positions from arbitrage desks, market makers, and whales. A balanced derivatives market means that there’s ample room for getting exercise if BTC continues to rally to $50,000 and above.

The views and opinions expressed listed below are solely these of the author and don’t essentially mirror the views of Cointelegraph. Each funding and buying and selling transfer includes threat. It is best to conduct your personal analysis when making a choice.