Last year was really bearish on the digital currency market and Bitcoin (BTC). The crypto market closed the year on a very poor level, despite the predictions and expectations of many analysts in the crypto space. In the course of the bear market, many digital currencies drift away from their all-time highs by more than 80 percent and even lost their positions on the list of top digital currencies by market cap.
Ethereum (ETH), which was the second largest digital currency in the world, lost its position to XRP (XRP) as a result of the massive plunges in the market. Tron (TRX), EOS, Litecoin (LTC), Stellar Lumens, and several other digital currencies were also affected.
Nevertheless, this year seems to have started well for Bitcoin (BTC) and the rest of the cryptos in the market. Bitcoin (BTC) ended last year close to the $3,500 mark. However, the digital currency has been trading within the range of $3,900 and $4,200 over the past couple of days.
The Long-to-Short Ratio of Bitcoin (BTC) Reaches Its Highest Since August 6th
The long-to-short ratio positions placed on Bitcoin (BTC) has gotten to its highest level in more than five months on Bitfinex – a top digital currency trading platform. At the time of writing, the long positions placed on Bitcoin (BTC) on the trading platform has reached a total of 33,750 units. That is equivalent to $137.3 million at the present market prices.
Meanwhile, BTC short positions placed on the trading platform has gotten to 22,787 units, which is about 11,000 less than the long positions. This is presently worth about $93 million. This creates the ratio of long-to-short of about 1.5:1 – the highest the market has seen since August 6th, 2018.
The decline in short positions isn’t really surprising, due to the fact that the value of Bitcoin (BTC) plunged by about 50% between November 14th and December 14th. This gave traders a lot of time to lock in profits as they await more opportunities.
A bullish technical reversal pattern which is known as the “inverse head and shoulders” pattern is also obvious on the price chart of Bitcoin (BTC). This might also play another role in scaring bears away from the market at the moment. Although the long-to-short ratio of Bitcoin being at multi-month highs might encourage the bulls of Bitcoin, the market might decline heavily again if Bitcoin breaks below the $3,200 support level.
If this happens, it would put the crypto at risk of experiencing a rapid closure or long squeeze of long positions. This could have a bearish and rapid impact on the value of Bitcoin (BTC) since selling back the longed Bitcoin (BTC) is the only way to terminate a long position.
Bitcoin (BTC) Price Today – BTC / USD
Bitcoin (BTC) has been trading within a range over the past couple of days. The digital currency is currently changing hands at $3,980 after a decrease of less than one percent over the past twenty-four hours. Bitcoin (BTC) is currently supported at the $3,800 mark and it is capped on the upside at the $4,200 level.
The current market cap of Bitcoin (BTC) is $69.63 billion and its trading volume over the past twenty-four hours is $3.17 billion. The digital currency seems to have some bullish sentiments around it, and it might surge higher in the near-term.
Princess Ogono is a writer, lawyer and fitness enthusiast. She believes cryptocurrencies are the future. When she's not writing, she spends time with her adorable cat, Ginger and works out often.