Bitcoin Whales Steer Clear Of Significant Short Positions, Show Confidence In Price Surge

Bitcoin Whales Steer Clear Of Significant Short Positions, Show Confidence In Price Surge

Time Stamp: February 20, 2024 4:30 PM
Source Node: 2488918

Bitcoin traders are exhibiting cautious optimism as they refrain from “substantial short positions,” expecting continued price surges, according to analysts from Bitfinex this week’s Alpha report.

Despite Bitcoin’s notable surge that brought the asset to trade as high as above $52,000 for the first time since 2021, analysts note a decrease in the short-squeeze ratio compared to previous years. The reason behind this declining short-squeeze ratio is revealed in the report.

BTC Short Squeeze Ratio vs price
BTC Short Squeeze Ratio vs price. | Source: Bitfinex Alpha report

Whales Shun Short Positions Amid Bullish Sentiment

Analysts at Bitfinex Alpha report that large whale investors are refraining from “substantial short positions” due to their belief that prices will only continue to increase further.

The current market conditions are characterized by “tightening supply and increasing demand,” further supporting the bullish sentiment among traders.

According to the Bitfinex Alpha report, the behavior of Bitcoin holders suggests the emergence of early bull-market conditions. This is evidenced by a reduction in the volume of long-term holder supply experiencing losses, a trend that correlates with the ongoing rise in the asset’s price.

This observation suggests a positive outlook for Bitcoin’s price trajectory in the near term. The report noted:

Currently, less than 6% of the aggregate long-term holder supply by individual entities are held at a loss. Historically, similar instances where the long-term holder cohort held a comparable volume of Bitcoin in loss have been indicative of early bull market conditions.

Bitcoin Trajectory And Investor Sentiment

In the past 24 hours, Bitcoin has experienced a slight retracement of nearly 2%, following a week-long uptrend that propelled its price to trade above $52,000 for the first time since 2021. Despite this retrace, investors remain optimistic, with ongoing asset accumulation amid bullish predictions from analysts and experts.

Renowned financial guru Robert Kiyosaki recently made headlines with his bold prediction that Bitcoin will reach $100,000 by June 2024, further fueling optimism in the crypto community.

Moreover, recent whale activity in the Bitcoin market has caught the attention of analysts and investors alike. Crypto analyst Ali Martinez recently revealed that a specific class of Bitcoin investors, holding between 1,000 and 10,000 BTC, has accumulated the digital asset in recent weeks.

Data from on-chain analytics firm Santiment shows that whales in this category have added over 140,000 coins to their holdings in the last three weeks, equivalent to a substantial $6.16 billion.

This accumulation trend among whales reflects confidence in Bitcoin’s long-term potential and is a positive indicator for its future price trajectory.

Featured image from Unsplash, Chart from TradingView

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