Bitcoin Professional Traders Purchase Dips While Expecting Further Downside

Takeaways from the conference:

• Bitcoin funding rates are at 7 percent, indicating that bullish traders still hesitate to take on more leveraged positions.

• Gold reached record levels, while spot Bitcoin ETFs experienced outflows of $1.58 billion. This indicates a move towards safe assets.

BitcoinBTC( ) is pinned under $91,000, even though equity markets have rallied due to strong US growth data and job creation. BTC has been struggling to get a bullish trend going. The lack of interest in leveraged BTC long positions is causing traders to doubt whether $88,000 will hold.

Bitcoin funding rates are annualized perpetual futures Thursday’s neutrality range was 6% – 12%. Although this is a significant improvement from Monday when the indicator was almost at zero, there still remains a lack of demand from the market for leverage that favors bulls.

Bitcoin Whales expected to continue accumulating

Bitcoin traders are not optimistic about the future of Bitcoin, in part because of the 4.4% US GDP growth for third-quarter. Strong economies generally boost earnings, which is a positive for stocks. For the week ending January 10, continuing claims for unemployment benefits fell by 26,000, to 1,85 million. 

There has not been a notable increase in the demand for BTC options to protect against a downside.

Laevitas’ data indicates that on both Wednesday and Friday, long Iron Condors and long straddles were the two BTC options strategies most actively traded. The two strategies place more emphasis on volatility than directional betting. The whales, and the market makers who are making these bets, may anticipate a period where prices will accumulate rather than experience a more severe correction.

Exchange long-to short ratios can be used to assess whether or not professional traders remain steadfast following a weekly correction of 11% from the peak on January 14th, which was $97900. The metric is more expansive than one contract because it aggregates positions in the futures markets, margin and perpetual markets.

Binance’s top traders increased their bullish positions on Thursday. The long-to-short rate rose to 2,18 from 2,08, and the ratio of long-to short-positions was upped to 2.18. On OKX, too, the top 20 percent of users by Margin increased long positions on Friday despite Bitcoin failing to recapture $90,000. Onchain data confirms that traders are neutral to bullish, despite the lack of interest in high leverage plays.

The focus of the market is shifting to corporate earnings. Microsoft (MSFT US), Tesla, (TSLA US), Apple, (AAPL US), Visa, (V US), are all reporting next week. General Motors and Starbucks will release their quarterly reports next Tuesday and Wednesday.

Prices for gold hit an all-time high The 10-year US Treasury Yields reached a 20-week peak on Thursday. The divergence usually signals declining confidence in the US fiscal situation. Given that there is an expanding US deficit, investors are worried about inflation.

Related: Bitcoin’s 16.7K inflow to exchanges raises alarm: Will BTC’s sell-off deepen?

The government’s borrowing costs will increase if Treasury yields rise. The yield on the 10-year note reached 4.25%, up from its previous level of 4.14%.

Bitcoin derivatives have shown resilience since the retest at $88,000, and there are few signs of a bearish mood. A move toward $95,000 will depend heavily on institutional inflows. This trend still hasn’t materialized after the net outflows of $1.58 Billion from Bitcoin Spot ETFs during the past two day.