Bitcoin Soars Above $109K, But Professional Traders Remain Wary

The key take-aways

• Bitcoin trading is at an all-time record high but the data from derivatives show that traders remain uncommitted and cautious.

• Investors are concerned about global trade tensions, as evidenced by the USDT discount and outflows from spot Bitcoin ETFs.

BitcoinBTC() soared over $109,000 Wednesday, after briefly testing the $105,200 level of support earlier that day. This rally was accompanied by data showing an expansion of the Eurozone’s monetary system and signs that the US labor market is weakening.

BTC says that even though Bitcoin is trading only 2% lower than its previous high, many traders are reluctant to become bullish. derivatives metrics. Some investors are now questioning the viability of this rally.

Bitcoin’s futures premium on Wednesday remained under the neutral 5% threshold. This small increase, from just 4% to 5% on Monday, continued a pattern that started on June 11 when the indicator was last in bullish territory. It coincided with Bitcoin’s test at the $110,000 mark.

Bitcoins’ rally is attributed to the increase in eurozone money supply.

It is hard to pinpoint a specific catalyst, but the record high broad money supply in April (M2) likely played an important role. These data were released Monday and showed an expansion of 2.7% on a year-over-year basis, which is in line with previous estimates. expansionary trajectory US Monetary Base ADP’s data revealed that US private employment fell 33,000 jobs in June.

Some market participants claim that the low demand for long leveraged positions in Bitcoin is due to the increased volatility. economic recession risksIn particular, amid an intensifying global trade conflict. US President Donald Trump warned that if a deal is not made by July 9, he will increase the import tariffs of Japanese goods to 30%.

Eurozone ambassadors have directed EU Trade Commissioner Maroš Šefčovič to adopt a tougher stance during his trip to Washington this week, according to the Financial Times. According to reports, European capitals called for a decrease in the 10% reciprocal duty. However, internal disagreements remain over whether or how to react.

Markets for Bitcoin options are neutral and stablecoins demand is weak in China

It’s useful to look at BTC options to determine if the lack of interest in Bitcoin derivatives are limited to futures. In the event that traders anticipated a rapid downturn, their 25% delta would increase above 6% as call options (buying) gain more than put options (selling).

As of today, the skew indicator is at zero percent, which has not changed in two days. It indicates that traders have equal risks when it comes to price changes. Although this indicates a lukewarm attitude at the $109,000 mark, it represents an improvement in the negative stance seen on June 22.

Related: Will Bitcoin benefit from ‘Big Beautiful Bill’ passage and US debt ceiling increase?

According to stablecoin premium, despite Bitcoin reaching its highest price in three weeks, the demand for cryptocurrency has dropped sharply in China.

The TetherUSDTInvestors who have withdrawn from the crypto market are usually reflected in a discount of the US dollar rate relative to that official exchange rate. Stablecoins tend to rise above their fixed rate when there is a strong demand for cryptos. The current 1% is the largest discount since mid-May. It indicates a lack confidence in Bitcoin’s recent gains.

After Tuesday, traders have become more concerned with the possible fallout of the ongoing trade war. $342 million in net outflows Exchange-traded Bitcoin funds. The subdued derivatives activity reflects the macroeconomic uncertainties.

This article was written for general information only and does not constitute legal or investment advice. This article is solely for informational purposes. It does not represent or reflect Cointelegraph’s views.