Bitcoin’s (BTC’s) increasing funding rate and open interest indicate bullish investor are opening longs, in order to defend range lows, as well an important support of $70,000. But another day spot ETF withdrawals makes investors worry that institutional sentiment on BTC has changed.
The chart shows that Bitcoin’s open interest is relatively stable, despite day-to-day trading. This further reinforces the belief that Bitcoin will continue to be a strong currency. long positions are either topping up Stay open or newly formed. Cross-exchange financing rates (the final indicator on the bottom chart) also show a majority of positive or neutral values, which indicates a bias towards long-term investments.
BTC/USDT one-hour chart. Source: Velo.xyz
Before the decline to $73,000 in BTC, percentage-wise liquidations were within the norms for BTC’s daily range, suggesting this week’s action was a continuation rather than an early confirmation of higher-timeframe trends.
Consideration of one important factor is “who” BTC’s price is supported by the influx of new investors. Hyblock’s True Retail Longs & Shorts Accounts indicator shows retail investors increasingly viewing corrections as dip-buying opportunities.
Hyblock analysts stated that.
“Long exposure now sits near 62%, a level where retail traders have historically been vulnerable to getting trapped. Over the last three months, backtested 15-minute data shows that when retail long positioning was above 62%, BTC posted positive returns 82% of the time seven days later, with a median forward return of 3.6% across 1,459 occurrences.”
Source: Hyblock. 7-day price changes in true retail shorts and longs. Source: Hyblock
Related: Bitcoin miner inflows to Binance soar as BTC struggles to hold uptrend: Is $70K next?
Coinbase Premium Counters negative ETF outflows and spot and perp trader’s efforts
Bitcoin Investors are not a new phenomenon, according to Bitfinex analysts. “cautious heading into Thursday’s (May 29) Personal Consumption Expenditures (PCE) report for April.”
Analysts said,
“Since 15 May, futures open interest (OI) has fallen sharply following a price correction that has seen BTC fall over 10 percent from recent highs above $82,000. Bitcoin’s aggregated global OI has now dropped back below $55 billion, the lowest reading since 11 April, and is down 14 percent from when BTC was trading above $80,000.”
The outflows of spot Bitcoin ETFs reached $200 million on Wednesday. Over the last seven days, they have exceeded $1.5billion. Bitfinex cited the Coinbase negative premium in addition to the reversed ETF flow. “significant warning sign.”
Bitcoin ETF Weekly Flows. Source: SoSoValue.com
“In the post-ETF landscape, this reflects a structural reality: direct US spot demand on Coinbase has been largely displaced by indirect institutional demand via ETFs, structured products, and over-the-counter desks.”
Even though Bitcoin is still a relatively new currency, analysts have noted that the price of Bitcoin has increased. “in an uptrend on the lower timeframes since the breakout” From $72,000 “the continuation set-up is absent.”
“A strong uptrend is typically driven via the spot tape, which would mean persistent negative funding rates and a persistent positive Coinbase premium. The opposite is the case at present.”
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Source: cointelegraph.com
