Bitcoin Skyrocketed To $40K. Why Are Pro Traders Still Cautious?
Even after Bitcoin jumped to $40,000, derivatives traders are still cautious. While some may feel euphoric after such a rise of BTC, the bears are still sleeping, since it’s not the first time Bitcoin has reached such a rate. Indeed, in mid-July, the first cryptocurrency was unable to maintain support at $40,000.
At the moment, the picture on the market is slightly different from what it was before. On June 8, Bitcoin fell to $31,000, and on June 14, it jumped to $41,000. Because of this, the liquidation of BTC short offers of $1.4 billion began. And although the bears did not expect such a turn, they were able to achieve the drop of Bitcoin to $38,000 after three days.
Therefore, the bulls have no good reason to believe in the possible sustainability of the current Bitcoin rally.
As you can see in the chart, the 1-month futures contract was unable to recover the annual premium above 5%, which would be an indicator of optimistic market sentiment. Although there have been some periods of backwardation over the past month, the current level is considered neutral.
As for the factors of “fear” and “greed”, at the moment the market remains neutral since the indicator does not exceed the range between negative 10% and positive 10%.
With all of these factors and many more, professional traders have been slow to fuel bullish sentiment.