VOT Research Desk

Market Analytics and Technical Considerations

Bitcoin traders increased their skewed long bets in the last 48 hours despite increased condemnation of cryptocurrency from lawmakers and crypto-skeptics.

Since the 25% crash that occurred between November 7 and 9, the price of Bitcoin BTC tickers down $16,614 has tested the $16,000 resistance multiple times. Some critics will be able to justify their bearish bias by incorrectly assuming that the failure of the FTX exchange should trigger a much broader correction.

For instance, The Economist correspondent Daniel Knowles describes the $322 billion market capitalization of the 26th largest tradable asset as “astonishingly useless and wasteful.” Additionally, Knowles stated, “There is still no logical case for specifically Bitcoin.”Pure ponzi scheme.

Even though Bitcoin is valued higher than secular companies like Nestle (NESN.SW), Bank of America (BAC), and Coca-Cola (KO), the price of Bitcoin is the single most important indicator of success for outsiders.

The success and failure rate of cryptocurrency exchanges has become the gatekeeper and success benchmark, when in fact the opposite is true. This is because the need for centralized authority over one’s money is so deeply ingrained in the majority of people. Since Bitcoin was developed as a peer-to-peer financial transmission network, adoption and exchange are not synonymous terms.

It merits featuring that Bitcoin has been attempting to break above $17,000 for the beyond seven days, so there is positively an absence of craving from purchasers over that level. Investors may be concerned about contagion risks, as Genesis Block was the most recent FTX victim to cease operations due to liquidity concerns. Recent reports claim that the business intends to end its operations and cease trading.

It is a fallacy to assume that centralized cryptocurrency exchange failure is the primary reason for Bitcoin’s downtrend or a reflection of its actual value, even though the price of Bitcoin is stuck in a downtrend that will be difficult to break.

Futures markets are in a bearish backwardation. Because sellers want more money to delay settlement for longer, fixed-month futures contracts typically trade at a slight premium to regular spot markets.This situation, which is technically referred to as contango, is not restricted to crypto assets.

Futures should trade at an annualized premium of 4 to 8 percent in healthy markets, which is sufficient to cover the risks and cost of capital.

Bitcoin 2-month futures premium annualized.Source:Laevitas.ch Looking at the data above, it’s clear that derivatives traders went bearish on Nov. 9 when the Bitcoin futures premium entered backwardation. This indicates that there is a lot of demand for shorts, which are bets on the downside.

Professional traders’ unwillingness to add leveraged long (bull) positions despite the inverted cost is reflected in this data.

Since the 25% crash that occurred between November 7 and 9, the price of Bitcoin BTC tickers down $16,614 has tested the $16,000 resistance multiple times. Some critics will be able to justify their bearish bias by incorrectly assuming that the failure of the FTX exchange should trigger a much broader correction.

For instance, The Economist correspondent Daniel Knowles describes the $322 billion market capitalization of the 26th largest tradable asset as “astonishingly useless and wasteful.” Additionally, Knowles stated, “There is still no logical case for specifically Bitcoin. Pure ponzi scheme.

Even though Bitcoin is valued higher than secular companies like Nestle (NESN.SW), Bank of America (BAC), and Coca-Cola (KO), the price of Bitcoin is the single most important indicator of success for outsiders.

The success and failure rate of cryptocurrency exchanges has become the gatekeeper and success benchmark, when in fact the opposite is true. This is because the need for centralized authority over one’s money is so deeply ingrained in the majority of people. Since Bitcoin was developed as a peer-to-peer financial transmission network, adoption and exchange are not synonymous terms.

It merits featuring that Bitcoin has been attempting to break above $17,000 for the beyond seven days, so there is positively an absence of craving from purchasers over that level. Investors may be concerned about contagion risks, as Genesis Block was the most recent FTX victim to cease operations due to liquidity concerns. Recent reports claim that the business intends to end its operations and cease trading.

It is a fallacy to assume that centralized cryptocurrency exchange failure is the primary reason for Bitcoin’s downtrend or a reflection of its actual value, even though the price of Bitcoin is stuck in a downtrend that will be difficult to break.

Futures markets are in a bearish backwardation. Because sellers want more money to delay settlement for longer, fixed-month futures contracts typically trade at a slight premium to regular spot markets. This situation, which is technically referred to as contango, is not restricted to crypto assets.

Futures should trade at an annualized premium of 4 to 8 percent in healthy markets, which is sufficient to cover the risks and cost of capital.

Bitcoin 2-month futures premium annualized.Source:Laevitas.ch Looking at the data above, it’s clear that derivatives traders went bearish on Nov. 9 when the Bitcoin futures premium entered backwardation. This indicates that there is a lot of demand for shorts, which are bets on the downside.

Professional traders’ unwillingness to add leveraged long (bull) positions despite the inverted cost is reflected in this data.

The longs-to-shorts ratio indicates a more balanced situation. Traders should look at the top traders’ longs-to-shorts ratio to rule out externalities that could only have affected the quarterly contracts. It better reveals professional traders’ positions by gathering information from exchange clients’ positions on spot, perpetual, and fixed-calendar futures contracts.

Since there are occasionally methodological differences between the various exchanges, readers should keep an eye on changes rather than absolute numbers.

Despite the fact that Bitcoin neglected to break the $17,000 obstruction on Nov. 18, proficient brokers somewhat expanded their influence long situations as per the long-to-short marker. For instance, the Huobi traders’ ratio has increased to 0.99 from 0.93 on November 16.

Since there are occasionally methodological differences between the various exchanges, readers should keep an eye on changes rather than absolute numbers.

Despite the fact that Bitcoin neglected to break the $17,000 obstruction on Nov. 18, proficient brokers somewhat expanded their influence long situations as per the long-to-short marker.For instance, the Huobi traders’ ratio has increased to 0.99 from 0.93 on November 17