- Long positions outweighed shorts despite BTC falling below $27,000.
- An increase in buying pressure and rising volatility could be key to the recovery.
Bitcoins [BTC] A drop to $26,794 should normally raise fears of another decline, as the King Coin was able to hold $27,000 for several days. However, traders are not fooled by the decline and are doubling their long positions in BTC.
Read Bitcoins [BTC] Price prediction 2023-2024
Not impressed with the decline
The pseudonymous analyst and trader Ali Charts reported this unprecedented circumstance on October 11. Using the Bitcoin long/short ratio indicator, Ali revealed that 65.33% of positions in the market were long.
If #Bitcoin falls below $27,000, more than 65% of all accounts are active #Binance with an open $BTC futures positions go long! pic.twitter.com/LVmNnu9ea5
— Ali (@ali_charts) October 11, 2023
This disparity caused the long/short ratio to rise to 1.88. Normally, a value of less than 1 for the indicator means that there are more short positions.
Thus, the value of 1.88 suggests that trader sentiment is largely bullish, with the average expectation being a notable recovery for BTC in the future. short-term.
But on the same day, long liquidations of BTC were higher than short liquidations. According to Coinglass, $14.57 million in long positions were wiped from the market on October 11.
At the time of writing, shorts were feeling the heat. So it’s likely that traders didn’t expect the recovery to happen quickly and could likely take several days.
Source: Coinglass
Buyers have an advantage
Meanwhile, the four-hour BTC/USD chart showed that there was a clear battle between bulls and bears over control of the market. However, the accumulation/distribution line (A/D) grew to 3.275 million.
The A/D measures the supply and demand of an asset. In general, a rising A/D confirms an increase in price, while a falling A/D indicates a downward trend in value. The rise in the indicator indicates buying pressure for BTC.
Should the A/D rise, there is a chance that Bitcoin will change hands above $27,000 in the coming days. This was also reinforced by the Bollinger Bands (BB).
At the time of writing, the BB did extensive. There is therefore a chance of significant price fluctuations. But this would only happen in an upward direction if accumulation continues to exceed distribution.
Source: TradingView
From a chain perspective, it also appeared that there was intense accumulation. One benchmark used to evaluate the opportunity is Bitcoin balance of addresses. This metric is described as the amount of money Bitcoin holders have in their portfolio.
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According to Santiment, not all holder cohort balances have increased.
However, the balance of addresses with between 1 and 100,000 coins has increased dramatically recently. If the rise continues, traders with long positions could be profitable finally.
