Bitcoin: Are bears falling off the wayside?


The Decrease in bitcoin Short Positions Signals Growing Confidence Among Traders

bitcoin‘s recent price surge has instilled optimism in the cryptocurrency sector, but it hasn’t been good news for bears who had taken short positions on the king coin. Short positions on Bitfinex have reached their lowest levels in the year, indicating diminishing bearish sentiment in the market. This suggests that those betting against bitcoin‘s price are becoming less active and traders are gaining confidence in its price prospects. Hedged short positions, which involve protecting against potential losses, have also surpassed unhedged short positions.

bitcoin‘s Reduced Correlation with NASDAQ Boosts Positive Sentiment

The increasing positive sentiment surrounding bitcoin can be attributed to its reduced correlation with NASDAQ, a major stock market index. The correlation between bitcoin and NASDAQ, which measures how they move together, is now at its lowest point since August 2021. This means that bitcoin is becoming less dependent on the NASDAQ’s performance, making it a more independent and potentially less risky investment. Traders see bitcoin as a way to balance out their portfolios and reduce overall risk. Diversification through bitcoin can provide stability over time.

The Impact of Rising Implied Volatility on bitcoin Trading

In addition to its reduced correlation with NASDAQ, bitcoin‘s trading can also be influenced by its Implied Volatility. This metric measures the market’s expectations of bitcoin‘s price movements. Recent surges in bitcoin‘s Implied Volatility have made traders more cautious and may affect their trading strategies going forward. Traders can choose to capitalize on the increased price movements or exercise caution in their trading decisions.

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Currently, BTC is trading at $34,406.07, with a 0.35% decrease in price over the last 24 hours.

Overall, the decrease in short positions, reduced correlation with NASDAQ, and rising Implied Volatility indicate a shift in sentiment towards bitcoin‘s prospects. Traders are gaining confidence in bitcoin as an investment and recognizing its potential for diversification and risk reduction. As the cryptocurrency market evolves, it’s important for traders to stay updated on these factors that can impact their trading decisions.



### News source: ambcrypto.com

By Team