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After a turbulent start of the week marked by a sharp downward swing below $ 100,000, the Bitcoin price was excellent and returns above $ 107,000 to close the week. Despite Bitcoin’s recent recovery, there seems to be a different sentiment in the market that has grown over time, interesting enough. This is how the current growing sentiment can influence the future process of the Prime Minister Cryptocurrency.
Short positions have risen in the last 7 days – what this means
In a post of 28 June on social media platform X, cryptocurrency analytics firm alphractal shared An interesting development in the chain in the Bitcoin market.
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This observation in the chain is based on the liquidity zone (7 days), which measures three important data: on the one hand it is used to check the price movement of Bitcoin; On another, the net delta of open interest or positions; And finally it shows the distribution of open interest at different price levels.
For a small context, the Net Delta with open interest rate measures the difference between long and short open positions in the market. If the Net Delta reads positively, it means that the buyers fill the market more. On the other hand, a negative reading means that there are more short positions open than long.
In the post on X, Alfractal pointed out that, during the seven -day period, more Positions are open in a bet at the price of BTC. From the graph below, the red beams represent a negative net delta. As explained earlier, this means that the short traders are currently dominating the market.
Interestingly, the Shorts-dominated market does not guarantee exactly that we will experience a sale in the near future. This is because the high negative Net Delta was registered at a time when the price of Bitcoin is still at a stable level, even with little growth.
When sales positions are opened in a stable but bullish market, this usually indicates that the bears may get stuck. If the Bitcoin price finally overcomes the sales resistance, a phenomenon that is known will act as a short squeeze.
In this scenario, sellers will be forced to buy back at higher prices, making the Bitcoin price the advantage. This upward momentum will then continue to liquidate short positions.
What is the next step for Bitcoin?
There are uncertainties about whether the Bitcoin market could break the sales resistance or go for the sellers. For this reason, Alfractal warns that those with bearish sentiment should be careful with their next step.
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At the moment Bitcoin seems to be stuck in a turbulent range in the past day and is currently appreciated at $ 107,309. The measly growth of the flagship cryptocurrency of 0.2% in the last 24 hours faded compared to the seven -day increase of 5.2%.
Featured image of Istock, graph of TradingView