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- Bitcoin could be transitioning from a preference for short-term to long-term gains.<\/em><\/li>\n
- Leverage traders back off after recent liquidations.<\/em><\/li>\n<\/ul>\n
Bitcoin [BTC]<\/a> traders have been waiting for signs that could indicate that the cryptocurrency was making the switch from short-term profit-taking to a long-term outlook. At press time, the market showed some signs that the switch might already be in effect.<\/p>\n
\nHow many are 1,10,100 BTCs worth today<\/a><\/p>\n
\nRecent market data indicated that Bitcoin trades executed in the options (derivatives) segment have been shifting in favor of a long-term outlook. The assessment of recent options trades revealed that quite a substantial number of trades focus on long-term trades<\/a> rather than short-term profits.<\/p>\n
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Even though the ETF news is over, there will not be any substantial benefits soon and the hype has come to an end. But BTC did attract market fund, with price up $1,000 compared to last week, while other coins were weaker.
And looking at the options data, bets on longer-term up\u2026 pic.twitter.com\/kq9NNuojG5<\/a><\/p>\n\u2014 Greeks.live (@GreeksLive) October 18, 2023<\/a><\/p>\n<\/blockquote>\n
Bitcoin demand in the derivatives segment often aligns with the sentiment in the spot market. Hence, the surge in derivatives demand can be used as a yardstick to assess the current state of the market. So, let\u2019s take a look at how Bitcoin\u2019s derivatives metrics have been fairing.<\/p>\n
Bitcoin sees some recovery<\/strong><\/h4>\n
BTC\u2019s open interest in the derivatives market dipped considerably in August. However, it has since recovered by a considerable margin. However, it did witness a slowdown since mid-October, and this could be due to a drop in the initial demand observed in the days prior.<\/p>\n
![\"Bitcoin](\"https:\/\/statics.ambcrypto.com\/wp-content\/uploads\/2023\/10\/My-Chart-2023-10-19T163847.824.png\")
<\/a><\/p>\nSource: CryptoQuant<\/p>\n<\/div>\n
Funding rates also recovered from August lows. However, the last three weeks saw a drop in BTC funding rates. This may not necessarily reflect the expectations of a long-term shift. However, there might be a good explanation for this.<\/p>\n
It turns out that Bitcoin\u2019s latest price spike<\/a> brought with it a dip in the estimated leverage ratio. This suggested that many traders had bearish expectations and thus, funding rates may have favored short positions prior to mid-October.<\/p>\n
![\"Bitcoin](\"image\/svg+xml,%3Csvg%20xmlns=\")
![\"Bitcoin](\"https:\/\/statics.ambcrypto.com\/wp-content\/uploads\/2023\/10\/My-Chart-2023-10-19T164511.675.png\")
<\/a><\/p>\nSource: CryptoQuant<\/p>\n<\/div>\n
The sudden price shift in favor of the bulls may have thus led to investors pulling their funds from short positions. This is what triggered a spike in short liquidations which soared to a four-month high. This could have supported higher BTC prices.<\/p>\n
\nRead Bitcoin\u2019s [BTC] price prediction<\/a> 2023-24<\/p>\n
\n - Leverage traders back off after recent liquidations.<\/em><\/li>\n<\/ul>\n