The bitcoin (BTC) market is at an "inflection point" after the historic Bitcoin 2024 conference, according to analysts.
We're finally out of the range, said independent analyst Horse, referring to open interest in #bitcoin futures,
Open Interest (OI) is the total number of #BTC derivatives contracts open on all exchanges.
An increase in this figure indicates that investors are opening new positions in the derivatives market. Since new contracts usually increase the overall market leverage, an increase in OI can lead to higher volatility of the asset. Independent market analyst Jose shared the chart below, which shows that the bitcoin OI on Coinbase #Pro has surpassed levels since March, when the price of BTC reached an all-time high.
The OI of bitcoin has risen along with its price, with the increase being driven by a shift in U. S. policy to support cryptocurrencies.
Referring to former U. S. President Donald Trump's remarks at the Bitcoin 2024 conference in Nashville on July 27, Mr. Horse said the sector has been handed all the bullish sentiment on a silver platter.
Whether or not this will happen is debatable, but either way we have to be bullish for the long term.
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Mr. Horse explained that after Mr. Trump's speech, long bets in the perpetual and options markets stopped and the price of bitcoin started to rise. This is very bullish.
From a price-to-earnings ratio perspective, the new long positions are not favorable. This alone argues in favor of shorting or at least hedging, which, while terribly stupid, is worth noting. This is because canceling or hedging the 69 that exit the trade when the highs are broken is very close.
An analyst colleague, Skeu, expressed a similar view, saying that the overall market for open-ended bitcoin futures is "purely long.
Mr. Skeu added that if the price breaks the $72,000 mark, "sustained spot buying" would be required to cover the risk that long positions currently carry.
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