Bitcoin (BTC) Short Bets Spike

Bitcoin (BTC) Short Bets Spike

Bitcoin (BTC) Short Bets Spike


  • The pessimistic sentiment around Bitcoin (BTC) prices saw the number of shorts spike to a 6-week high Thursday.
  • Bitcoin is on track to post its biggest annual price drop on record. That would change only if prices rise above $5,959.
  • The symmetrical triangle breakdown favors a drop to $3,474. Acceptance below that mark would further strengthen the Bears hold and open the Southside to the psych support at $3,000.
  • A short-term Bullish reversal would be confirmed only above $4,400.

The BTCUSD short positions on the cryptocurrency exchange Bitfinex jumped to 37,891 the highest mark since 15 October, and were last seen at 36,996. Notably, shorts have risen by 95% in the last 3 weeks, accompanying BTC’s recent drop to 14-month lows near $3,500.

The Short positions remained elevated above 35,000 during BTC’s oversold bounce from $3,500 to $4,400 and climbed to fresh multi-week highs Thursday.

Further, the long-short ratio of 0.73 is biased toward the Bears.

BTC/USD Shorts on Bitfinex

The data indicates that, despite being so deep into the Mr. Bear’s territory, sellers appear to be showing no signs of exhaustion in here.

As a result, the cryptocurrency is currently trading a low at $3,406.75 Friday, the market is open.

The overall Bearish sentiment could soon reach extremes, as the short positions are down just 7% from the record high of 40,289 that was reached on on 19 September. Moreover, the extreme Bearish positioning is widely considered a sign that the sell-off is overdone and often preceeds a Key trend reversal.

Therefore, the prospects of sudden Bullish reversal, similar to the 1 seen on 12 April 2018, would improve substantially once the short positions reach record highs.

With the bears still keeping the upper hand, a significant recovery from current levels appears unlikely before year’s end, and BTC looks set to snap its 3-year winning streak with a 74% annual price drop, its biggest on record.

BTC’s only previous annual loss was a 57% dive in Y 2014. This year’s loss would be the biggest on record as long as prices hold below $5,959.

Meanwhile, the technical charts indicate that the Bitcoin may extend the loss further before the year’s end.

Have a terrific weekend

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