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â ïžBitcoin must not lose $54,450; otherwise, a bearish move with high probability is likely.
This is what the Alpha Price metric is showing. It identifies $65,300 as the next major short-term resistance and $54,450 as the critical support to maintain the bullish cycle.
The Alpha Price is a powerful metric that adjusts Bitcoin's value based on the average price investors paid and compares it to the market average. It helps determine if the current BTC price reflects the historical investment value, offering valuable insights into potential opportunities or risks.
Historically, when $BTC loses the third upper level, a bearish process forms. However, if it stays above this level, the bull run remains intact.
In summary, BTC is currently in a clear bull run, but the $54K region could drastically change the market outlook, as many addresses are starting to enter the loss zone.
Twitter @Alphractal
This is what the Alpha Price metric is showing. It identifies $65,300 as the next major short-term resistance and $54,450 as the critical support to maintain the bullish cycle.
The Alpha Price is a powerful metric that adjusts Bitcoin's value based on the average price investors paid and compares it to the market average. It helps determine if the current BTC price reflects the historical investment value, offering valuable insights into potential opportunities or risks.
Historically, when $BTC loses the third upper level, a bearish process forms. However, if it stays above this level, the bull run remains intact.
In summary, BTC is currently in a clear bull run, but the $54K region could drastically change the market outlook, as many addresses are starting to enter the loss zone.
Twitter @Alphractal
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Cumulative Value Days Destroyed (CVDD) is currently the most accurate metric for identifying Bitcoin price bottoms. Historical data shows instances where Bitcoin price retested CVDD following aggressive volatility, notably in August 2015 and March 2020. If this pattern repeats, the current CVDD value stands at $24,000. CVDD is calculated based on the cumulative value of coins moved on the blockchain, providing insights into investor behavior and potential price trends.
Something extraordinary is happening with Bitcoin
đšSomething extraordinary is happening with Bitcoin
Since 2020, weâve been witnessing an unprecedented mass adoption, with over 4.33 million BTC leaving Exchanges.
This represents more than $129 billion withdrawn, and today, those same BTC are worth nearly $260 billion! đ„
The scale of these outflows is so significant that the BTC reserves on Exchanges are rapidly depleting. To put things in perspective, in February 2020, Exchanges still held around 1.66 million BTC. But since then, the outflows have been consistent and outpaced the accumulation rate of Exchanges.
What does this mean? We are seeing an increasing decentralization of the BTC supply, driven by mass adoption. Large corporations, institutions, and investors from all backgrounds are incorporating Bitcoin into their investment strategies.
If this trend continues, we could face a severe supply shock by 2028, potentially driving more peer-to-peer (P2P) trading and pushing prices higher.
â Positive Points:
- Decentralization of Supply: With fewer BTC on Exchanges, control is distributed among more investors, promoting security and decentralization.
- Long-Term Confidence: Significant withdrawals indicate that more investors are betting on Bitcoinâs potential as a long-term store of value.
- Reduced Exchange Manipulation: With less BTC available on Exchanges, the impact of large volumes decreases, reducing the chance of direct price manipulation.
- Potential Price Appreciation: The scarcity of BTC on Exchanges could lead to a supply shock, driving prices to new heights.
- Increase in P2P Transactions: Less BTC on Exchanges could encourage more direct transactions between users, strengthening Bitcoin's P2P ecosystem.
â ïžNegative Points:
- Liquidity Reduction: Massive BTC withdrawals may reduce Exchange liquidity, increasing volatility and the risk of significant price swings.
- Higher Volatility: The scarcity of BTC may amplify price movements, especially with large buy or sell orders.
- Whale Manipulation Risk: Large investors could take advantage of low liquidity to influence prices.
- Institutional Challenges: Institutions and large investors may struggle to acquire large amounts of BTC without significantly affecting the price.
- Reliance on Futures Markets: The lack of BTC on spot Exchanges could lead to increased reliance on futures markets, potentially disconnecting spot prices from derivatives.
$BTC
Since 2020, weâve been witnessing an unprecedented mass adoption, with over 4.33 million BTC leaving Exchanges.
This represents more than $129 billion withdrawn, and today, those same BTC are worth nearly $260 billion! đ„
The scale of these outflows is so significant that the BTC reserves on Exchanges are rapidly depleting. To put things in perspective, in February 2020, Exchanges still held around 1.66 million BTC. But since then, the outflows have been consistent and outpaced the accumulation rate of Exchanges.
What does this mean? We are seeing an increasing decentralization of the BTC supply, driven by mass adoption. Large corporations, institutions, and investors from all backgrounds are incorporating Bitcoin into their investment strategies.
If this trend continues, we could face a severe supply shock by 2028, potentially driving more peer-to-peer (P2P) trading and pushing prices higher.
â Positive Points:
- Decentralization of Supply: With fewer BTC on Exchanges, control is distributed among more investors, promoting security and decentralization.
- Long-Term Confidence: Significant withdrawals indicate that more investors are betting on Bitcoinâs potential as a long-term store of value.
- Reduced Exchange Manipulation: With less BTC available on Exchanges, the impact of large volumes decreases, reducing the chance of direct price manipulation.
- Potential Price Appreciation: The scarcity of BTC on Exchanges could lead to a supply shock, driving prices to new heights.
- Increase in P2P Transactions: Less BTC on Exchanges could encourage more direct transactions between users, strengthening Bitcoin's P2P ecosystem.
â ïžNegative Points:
- Liquidity Reduction: Massive BTC withdrawals may reduce Exchange liquidity, increasing volatility and the risk of significant price swings.
- Higher Volatility: The scarcity of BTC may amplify price movements, especially with large buy or sell orders.
- Whale Manipulation Risk: Large investors could take advantage of low liquidity to influence prices.
- Institutional Challenges: Institutions and large investors may struggle to acquire large amounts of BTC without significantly affecting the price.
- Reliance on Futures Markets: The lack of BTC on spot Exchanges could lead to increased reliance on futures markets, potentially disconnecting spot prices from derivatives.
$BTC
đŻThe level around $46,460 could become the next price floor for Bitcoin in the near future. This value represents the True Market Mean Price, a metric that reflects the networkâs weighted average price.
Weâve previously discussed the significance of the True Market Mean Price and the powerful AVIV Ratio oscillator. A clear example of this metricâs impact was observed during the "China Dump" in May 2021, when the True Market Mean Price provided support for Bitcoin for two months before the price reached new all-time highs.
Since March 2024, we've seen a rapid decline in demand for Bitcoin, while market makers seem to be attempting to drive the price down. In this scenario, a smart DCA (Dollar Cost Averaging) strategy would be to closely monitor the True Market Mean Price, as it has proven to be a more accurate metric than the Realized Price, especially since it excludes coins related to mining.
Weâve previously discussed the significance of the True Market Mean Price and the powerful AVIV Ratio oscillator. A clear example of this metricâs impact was observed during the "China Dump" in May 2021, when the True Market Mean Price provided support for Bitcoin for two months before the price reached new all-time highs.
Since March 2024, we've seen a rapid decline in demand for Bitcoin, while market makers seem to be attempting to drive the price down. In this scenario, a smart DCA (Dollar Cost Averaging) strategy would be to closely monitor the True Market Mean Price, as it has proven to be a more accurate metric than the Realized Price, especially since it excludes coins related to mining.
đ„Leverage Positions on Binance Reveal True Trader Sentiment!
Our Long vs Short Open Interest metric clearly shows that, over time, the dominant positions have been longs. The last time shorts outnumbered longs in the total open interest was in 2022.
The Long vs Short Open Interest Ratio measures the proportion of longs to shorts in the open interest. Currently, the ratio is at 51.8% for longs. In 2024, new long positions surged to peaks of 66%, leading to a BTC price dump. A recent value close to 50% suggests a rising interest in shorts, potentially indicating local bottoms if it falls below 50%.
The Long/Short Ratio (Accounts) is a well-known metric in the market, demonstrating that when accounts favor shorts, BTC prices often move against this sentiment, leading to liquidations. Currently, 62% of trades on Binance are long positions, while 38% are short.
The Long/Short Ratio Dominance metric helps pinpoint precisely when the number of trades is skewed towards longs or shorts. Historically, when traders favor shorts, prices often rise or form local highs, as seen with local tops in 2024. Conversely, excessive long positions tend to lead to price declines or consolidation.
These metrics confirm the significant impact of leveraged positions on Binance, offering valuable sentiment insights. Understanding these dynamics can give you an alpha edge in your trading strategies!
Our Long vs Short Open Interest metric clearly shows that, over time, the dominant positions have been longs. The last time shorts outnumbered longs in the total open interest was in 2022.
The Long vs Short Open Interest Ratio measures the proportion of longs to shorts in the open interest. Currently, the ratio is at 51.8% for longs. In 2024, new long positions surged to peaks of 66%, leading to a BTC price dump. A recent value close to 50% suggests a rising interest in shorts, potentially indicating local bottoms if it falls below 50%.
The Long/Short Ratio (Accounts) is a well-known metric in the market, demonstrating that when accounts favor shorts, BTC prices often move against this sentiment, leading to liquidations. Currently, 62% of trades on Binance are long positions, while 38% are short.
The Long/Short Ratio Dominance metric helps pinpoint precisely when the number of trades is skewed towards longs or shorts. Historically, when traders favor shorts, prices often rise or form local highs, as seen with local tops in 2024. Conversely, excessive long positions tend to lead to price declines or consolidation.
These metrics confirm the significant impact of leveraged positions on Binance, offering valuable sentiment insights. Understanding these dynamics can give you an alpha edge in your trading strategies!
đ Altcoins are starting to outperform BTC!
The Altcoin Season Index shows a clear trend:
Last 30 days: 44 out of 61 altcoins outperformed Bitcoin.
Last 90 days: Only 9 out of 61 altcoins outperformed Bitcoin.
When we exclude Ethereum and all stablecoins from the Altcoin Dominance analysis, we see a pattern similar to what happened between 2019 and 2020.
This could be a prime moment to start accumulating solid projects, as they show greater potential for growth compared to BTC.
#Altcoins #defi #ETH #bnb #sol $ETH $SOL $BNB
The Altcoin Season Index shows a clear trend:
Last 30 days: 44 out of 61 altcoins outperformed Bitcoin.
Last 90 days: Only 9 out of 61 altcoins outperformed Bitcoin.
When we exclude Ethereum and all stablecoins from the Altcoin Dominance analysis, we see a pattern similar to what happened between 2019 and 2020.
This could be a prime moment to start accumulating solid projects, as they show greater potential for growth compared to BTC.
#Altcoins #defi #ETH #bnb #sol $ETH $SOL $BNB
đ€ŻOur fractal recognition algorithm identified a period in November with high similarity to the last 15 days, based on a 15-minute timeframe. This strategy requires intensive data processing to detect patterns unnoticed by traders, something traditional platforms can't achieve with such small timeframes. This is truly an ALPHA solution.
đ Coin Days Destroyed (CDD) is a critical metric for understanding Bitcoin's market dynamics. When we talk about Bitcoin Days, we refer to the number of days a particular Bitcoin remains unspent. For instance, if 1 BTC is held for 100 days, it accumulates 100 Bitcoin Days. When that Bitcoin is eventually spent, those 100 days are "destroyed." This concept, known as Bitcoin Days Destroyed, serves as an indicator of the movement of long-held coins by long-term holders (LTHs), often considered smart money.
đ Market Peaks and Long-Term Holders: In the past, significant peaks in Bitcoin's price have been preceded by a sharp increase in Bitcoin Days Destroyed, signaling the distribution of old coins by these LTHs. Notably, in late 2017, 2021, and 2024, we observed this pattern, where LTHs started to offload their Bitcoin holdings, leading to heightened market activity and eventually, price peaks.
âïž Supply Adjustment: To account for the growing Bitcoin supply over time, we can apply a supply adjustment multiplier, leading to the Terminal Adjusted Coin Days Destroyed metric. This adjustment ensures that the data reflects more recent conditions in the market, rather than just magnifying older data.
đ Key Indicators: When analyzing the 90-day moving average (90DMA) of the Terminal Adjusted Coin Days Destroyed, a value surpassing 18 million serves as a warning signal for Bitcoin's bull cycle. Similarly, when the 200-day moving average (200DMA) exceeds 16 million, it also indicates increased risk. These thresholds have proven to be key indicators of market risk during previous cycles.
đ Investor Strategy: Monitoring these metrics allows investors to better anticipate potential market tops and take precautionary measures, particularly when these thresholds are breached.
X: @Alphractal
Telegram Channel: alphractal
Telegram Discussion Group: alphractal_group
đ Market Peaks and Long-Term Holders: In the past, significant peaks in Bitcoin's price have been preceded by a sharp increase in Bitcoin Days Destroyed, signaling the distribution of old coins by these LTHs. Notably, in late 2017, 2021, and 2024, we observed this pattern, where LTHs started to offload their Bitcoin holdings, leading to heightened market activity and eventually, price peaks.
âïž Supply Adjustment: To account for the growing Bitcoin supply over time, we can apply a supply adjustment multiplier, leading to the Terminal Adjusted Coin Days Destroyed metric. This adjustment ensures that the data reflects more recent conditions in the market, rather than just magnifying older data.
đ Key Indicators: When analyzing the 90-day moving average (90DMA) of the Terminal Adjusted Coin Days Destroyed, a value surpassing 18 million serves as a warning signal for Bitcoin's bull cycle. Similarly, when the 200-day moving average (200DMA) exceeds 16 million, it also indicates increased risk. These thresholds have proven to be key indicators of market risk during previous cycles.
đ Investor Strategy: Monitoring these metrics allows investors to better anticipate potential market tops and take precautionary measures, particularly when these thresholds are breached.
X: @Alphractal
Telegram Channel: alphractal
Telegram Discussion Group: alphractal_group
Accumulation Trend Heatmap Cohort measures BTC accumulation versus distribution, making it an essential metric for assessing onchain sentiment.
The current overview for each cohort is:
đ Largest Whales (>100k BTC): Distributed BTC between March and May 2024, accumulating again between July and early August. However, they have shown a gradual decrease in interest in accumulating BTC since then.
đł Whales (10k-100k BTC): Have been distributing a significant amount of BTC since mid-July.
đŠ Sharks (1k-10k BTC): Distributed their coins between May and August, and have now resumed accumulation, though at a modest pace.
đŹ Dolphins (100-1k BTC): This is the category that has been accumulating the most BTC, with intensified activity since early August.
đ Addresses with less than 100 BTC: Have shown neutral behavior compared to 60 days ago, indicating low activity from this category. These addresses are typically associated with small miners, small businesses, funds, and retail investors.
Since 2023, the addresses of Sharks (1k-10k BTC) have shown the highest correlation with Bitcoinâs price, with a correlation of 0.862. Monitoring this category can provide a clear summary of the sentiment among the market's key investors.
X: @Alphractal
Telegram Discussion Group: @alphractal_group
#Whale #Shark #AccumulationTrend #Bitcoin #SmartMoney
The current overview for each cohort is:
đ Largest Whales (>100k BTC): Distributed BTC between March and May 2024, accumulating again between July and early August. However, they have shown a gradual decrease in interest in accumulating BTC since then.
đł Whales (10k-100k BTC): Have been distributing a significant amount of BTC since mid-July.
đŠ Sharks (1k-10k BTC): Distributed their coins between May and August, and have now resumed accumulation, though at a modest pace.
đŹ Dolphins (100-1k BTC): This is the category that has been accumulating the most BTC, with intensified activity since early August.
đ Addresses with less than 100 BTC: Have shown neutral behavior compared to 60 days ago, indicating low activity from this category. These addresses are typically associated with small miners, small businesses, funds, and retail investors.
Since 2023, the addresses of Sharks (1k-10k BTC) have shown the highest correlation with Bitcoinâs price, with a correlation of 0.862. Monitoring this category can provide a clear summary of the sentiment among the market's key investors.
X: @Alphractal
Telegram Discussion Group: @alphractal_group
#Whale #Shark #AccumulationTrend #Bitcoin #SmartMoney
â ïžMost traders don't know this, but the stocks of cryptocurrency mining companies often anticipate Bitcoin's movements. Miners hold approximately between 1.9 and 2.1 million BTC, making them the true giants of the crypto market.
The aggregated Market Cap of miners generally forms peaks and troughs before Bitcoin's trend changes, demonstrating just how key and opportunistic these miners are when it comes to BTC's price.
When analyzing this same indicator on a logarithmic scale, we observe the formation of a rising wedge, which, in technical analysis, is a bearish signal that needs to be monitored closely in the coming weeks.
One of our Minerâs Indexes is weighted according to the largest mining companies, meaning that companies with a higher Market Cap have a greater influence on the metric. We really appreciate this metric because it simply and effectively shows strength and weakness, much like analyzing each company individually. In fact, this metric rises or falls before Bitcoin's price, providing an excellent early signal for future trades.
Finally, we have the Minerâs Momentum, which is the multiplication of Market Cap by Hash Rate. This provides clear signals that as both the stocks and Bitcoinâs Hash Rate rise, Bitcoinâs price tends to follow. When this metric declines sharply, it's a sign that the stocks are falling, and the Hash Rate is decreasing, indicating a reduction in computational power, profit-taking, or significant changes in the strategies of these companies.
We would like to know if you use mining data for decision-making, as we have a deep appreciation for the mining space!
Twitter X: @Alphractal
The aggregated Market Cap of miners generally forms peaks and troughs before Bitcoin's trend changes, demonstrating just how key and opportunistic these miners are when it comes to BTC's price.
When analyzing this same indicator on a logarithmic scale, we observe the formation of a rising wedge, which, in technical analysis, is a bearish signal that needs to be monitored closely in the coming weeks.
One of our Minerâs Indexes is weighted according to the largest mining companies, meaning that companies with a higher Market Cap have a greater influence on the metric. We really appreciate this metric because it simply and effectively shows strength and weakness, much like analyzing each company individually. In fact, this metric rises or falls before Bitcoin's price, providing an excellent early signal for future trades.
Finally, we have the Minerâs Momentum, which is the multiplication of Market Cap by Hash Rate. This provides clear signals that as both the stocks and Bitcoinâs Hash Rate rise, Bitcoinâs price tends to follow. When this metric declines sharply, it's a sign that the stocks are falling, and the Hash Rate is decreasing, indicating a reduction in computational power, profit-taking, or significant changes in the strategies of these companies.
We would like to know if you use mining data for decision-making, as we have a deep appreciation for the mining space!
Twitter X: @Alphractal
Leveraged Traders' Sentiment is an incredibly powerful metric that explains why most traders fail with leverage. Essentially, when Long positions start increasing on exchanges, Bitcoin's price tends to drop, and the reverse is also trueâwhen the metric starts to decrease, the price goes up. The derivatives market currently has the most significant influence on Bitcoin's price action, as the derivatives volume across all exchanges can exceed 16 times the traded value in spot trades.
đŻMastering these metrics elevates you to an Alpha level in trading!
Twitter: @Alphractal
đŻMastering these metrics elevates you to an Alpha level in trading!
Twitter: @Alphractal
The Kansas City Fed Labor Market Conditions Index (LMCI) is an economic indicator developed by the Federal Reserve Bank of Kansas City to measure the overall conditions of the labor market in the United States. It aggregates 24 variables related to employment, hours worked, unemployment, and other metrics that provide a comprehensive view of the health of the labor market.
đ LMCI Behavior and Market Impact:
Downward Trend: When the LMCI starts to decline, it typically signals a weakening labor market. A weaker labor market tends to reduce consumer expectations, leading to lower spending, which can be an early warning sign of an impending recession. Historically, the LMCI began to drop before recessions, with the impact on the stock market, such as the S&P 500, felt only months or days later.
Upward Trend: When the LMCI is rising, it indicates a strengthening labor market. A robust labor market can boost consumer confidence and lead to higher spending, driving economic growth.
đ Historical Divergence:
Currently, we are witnessing a significant historical divergence: while most labor indicators are falling, financial markets, such as the S&P 500, continue to rise. This discrepancy raises concerns about the sustainability of the current market rally, especially if the weakening labor market eventually weighs on economic growth.
Twitter: @Alphractal
#BTC #AltcoinStrategies #recession #Bearish #Risk
đ LMCI Behavior and Market Impact:
Downward Trend: When the LMCI starts to decline, it typically signals a weakening labor market. A weaker labor market tends to reduce consumer expectations, leading to lower spending, which can be an early warning sign of an impending recession. Historically, the LMCI began to drop before recessions, with the impact on the stock market, such as the S&P 500, felt only months or days later.
Upward Trend: When the LMCI is rising, it indicates a strengthening labor market. A robust labor market can boost consumer confidence and lead to higher spending, driving economic growth.
đ Historical Divergence:
Currently, we are witnessing a significant historical divergence: while most labor indicators are falling, financial markets, such as the S&P 500, continue to rise. This discrepancy raises concerns about the sustainability of the current market rally, especially if the weakening labor market eventually weighs on economic growth.
Twitter: @Alphractal
#BTC #AltcoinStrategies #recession #Bearish #Risk
Bitcoin Long-Term Power Law Analysis (Log-Log): Unveiling Market Secrets
đThe Bitcoin Long-Term Power Law Analysis (Log-Log) is a powerful analytical tool designed to reveal critical patterns throughout Bitcoin's history. Our innovative algorithm plots various lines that help identify market peaks and troughs, highlighting significant points where Bitcoin's price has historically encountered resistances and supports. These lines provide a unique strategic view of future trends.
đIn recent years, weâve observed that Bitcoinâs momentum decreases every 4.5 years, following a cycle with a perfectly asymmetric trend. This algorithm offers a robust foundation for identifying support and resistance areas at different price stages of Bitcoin, delivering a strong investment strategy.
â ïžIn 2024, Bitcoin's price reached a significant resistance level, marking a crucial point in a medium-term cycle that historically demarcates local peaks and troughs. Bitcoin needs to stay above $59,000 to ensure short-term support. Otherwise, the next major supports are expected at $48,000 or $38,000. Between 2019 and 2020, Bitcoin's price contended with these lines, showing large volatility movements such as the "Coronadump" and the 2020 Bull Run.
This advanced analysis not only sheds light on market complexities but also provides investors with a powerful tool to predict future movements based on historical patterns, marking the beginning of a new era of informed and precise investment strategies.
Twitter (X): @Alphractal
$BTC
đThe Bitcoin Long-Term Power Law Analysis (Log-Log) is a powerful analytical tool designed to reveal critical patterns throughout Bitcoin's history. Our innovative algorithm plots various lines that help identify market peaks and troughs, highlighting significant points where Bitcoin's price has historically encountered resistances and supports. These lines provide a unique strategic view of future trends.
đIn recent years, weâve observed that Bitcoinâs momentum decreases every 4.5 years, following a cycle with a perfectly asymmetric trend. This algorithm offers a robust foundation for identifying support and resistance areas at different price stages of Bitcoin, delivering a strong investment strategy.
â ïžIn 2024, Bitcoin's price reached a significant resistance level, marking a crucial point in a medium-term cycle that historically demarcates local peaks and troughs. Bitcoin needs to stay above $59,000 to ensure short-term support. Otherwise, the next major supports are expected at $48,000 or $38,000. Between 2019 and 2020, Bitcoin's price contended with these lines, showing large volatility movements such as the "Coronadump" and the 2020 Bull Run.
This advanced analysis not only sheds light on market complexities but also provides investors with a powerful tool to predict future movements based on historical patterns, marking the beginning of a new era of informed and precise investment strategies.
Twitter (X): @Alphractal
$BTC
đMarket Recovery Updateđ
After a significant decline in cryptocurrency prices, the market has partially recovered, with the Total Crypto Market Cap now reaching $2.2 trillion USD.đ
Altcoins in the following categories appear to have hit a local bottom and are currently experiencing a positive recovery:
đčPayment
đčProof of Work
đčFan Tokens
đčCardano Ecosystem
đStay tuned for more updates!
After a significant decline in cryptocurrency prices, the market has partially recovered, with the Total Crypto Market Cap now reaching $2.2 trillion USD.đ
Altcoins in the following categories appear to have hit a local bottom and are currently experiencing a positive recovery:
đčPayment
đčProof of Work
đčFan Tokens
đčCardano Ecosystem
đStay tuned for more updates!
đš Interest in Short Positions on Bitfinex for BTC and ETH Hits Historic Lows!
Historically, when long positions on Bitfinex increase rapidly, the market tends to decline.
For BTC, we observe a strong inverse correlation: an increase in long positions generally leads to a decrease in price. Since March 2024, long positions have risen to 62,570 BTC, compared to only 418.5 BTC in short positions. This represents an impressive difference of 149 times in favor of longs.
In the case of ETH, the situation is quite different. Until 2022, there was a closer balance between long and short positions. However, since then, short positions have drastically decreased relative to longs. Interestingly, in 2021, when short positions surpassed long positions, ETH marked the cycle tops. Currently, there are 63,860 ETH in long positions versus 3,334 ETH in short positions, a difference of approximately 19 times.
While most exchanges show a higher volume of long positions, the ongoing increase in long positions on Bitfinex could indicate potential price declines and forced liquidations of traders. On the flip side, a price correction could signal a great opportunity for the cryptocurrency market!
Stay alert and monitor the changes to seize the best opportunities!
Twitter ('X'): @Alphractal
$BTC $ETH
Historically, when long positions on Bitfinex increase rapidly, the market tends to decline.
For BTC, we observe a strong inverse correlation: an increase in long positions generally leads to a decrease in price. Since March 2024, long positions have risen to 62,570 BTC, compared to only 418.5 BTC in short positions. This represents an impressive difference of 149 times in favor of longs.
In the case of ETH, the situation is quite different. Until 2022, there was a closer balance between long and short positions. However, since then, short positions have drastically decreased relative to longs. Interestingly, in 2021, when short positions surpassed long positions, ETH marked the cycle tops. Currently, there are 63,860 ETH in long positions versus 3,334 ETH in short positions, a difference of approximately 19 times.
While most exchanges show a higher volume of long positions, the ongoing increase in long positions on Bitfinex could indicate potential price declines and forced liquidations of traders. On the flip side, a price correction could signal a great opportunity for the cryptocurrency market!
Stay alert and monitor the changes to seize the best opportunities!
Twitter ('X'): @Alphractal
$BTC $ETH
â ïžProbability of a Global Economic Recession and Risks for Cryptocurrencies
Assessing the probability of a global recession involves analyzing indicators like GDP, inverted yield curve, unemployment rate, consumer confidence, and inflation. Declines in international trade đ and stock markets are also important signals.
However, today we will focus on specific metrics:
- Global Economic Policy Uncertainty Index đ: Moderate Risk (upward trend, indicating global uncertainty).
- Economic Policy Uncertainty Index for the US đșđž: Moderate Risk (high volatility, similar to 2007-2008).
- Breakeven Inflation Rate đ”: Moderate Risk (downward trend, similar to early 2020).
- U.S. Recession Probability đșđž: Low (slow-moving metric, based on variables like employment and industrial production).
- U.S. Smoothed Recession Probability (Forecast) đź: High Risk (forecast with good historical accuracy).
- Sahm Rule Recession đš: Moderate Risk (slow metric, usually reacts only to major market downturns).
Currently, about 65% of the 22 metrics indicate moderate to high risk, suggesting potential negative impacts on cryptocurrencies and the global financial context. However, since 2023, Asian liquidity has surpassed Western economies, highlighting the importance of monitoring indicators from China, India, Korea, and others.
Generally, these metrics take up to 2 years to materialize a recession, meaning short-term impact may be limited but should not be overlooked.
Twitter ('X'): @Alphractal
Assessing the probability of a global recession involves analyzing indicators like GDP, inverted yield curve, unemployment rate, consumer confidence, and inflation. Declines in international trade đ and stock markets are also important signals.
However, today we will focus on specific metrics:
- Global Economic Policy Uncertainty Index đ: Moderate Risk (upward trend, indicating global uncertainty).
- Economic Policy Uncertainty Index for the US đșđž: Moderate Risk (high volatility, similar to 2007-2008).
- Breakeven Inflation Rate đ”: Moderate Risk (downward trend, similar to early 2020).
- U.S. Recession Probability đșđž: Low (slow-moving metric, based on variables like employment and industrial production).
- U.S. Smoothed Recession Probability (Forecast) đź: High Risk (forecast with good historical accuracy).
- Sahm Rule Recession đš: Moderate Risk (slow metric, usually reacts only to major market downturns).
Currently, about 65% of the 22 metrics indicate moderate to high risk, suggesting potential negative impacts on cryptocurrencies and the global financial context. However, since 2023, Asian liquidity has surpassed Western economies, highlighting the importance of monitoring indicators from China, India, Korea, and others.
Generally, these metrics take up to 2 years to materialize a recession, meaning short-term impact may be limited but should not be overlooked.
Twitter ('X'): @Alphractal
Most altcoins are at unprecedented levels of high leverage, as indicated by the elevated Open Interest to Market Cap ratio. However, STORJ presents a different case, with a negative Funding Rate, which may suggest an imminent appreciation due to short liquidations.
We recommend trading in derivative markets where the OI/Market Cap ratio is low, as this tends to reduce the risk of forced liquidations during Pumps and Dumps
#STORJ $STORJ #Altcoins #Liquidation
Twitter (X): @Alphractal
We recommend trading in derivative markets where the OI/Market Cap ratio is low, as this tends to reduce the risk of forced liquidations during Pumps and Dumps
#STORJ $STORJ #Altcoins #Liquidation
Twitter (X): @Alphractal
We are currently in a period where some of Bitcoin's capital is migrating to Altcoins in the short term. In 70% of cases, this has had a negative impact on Bitcoin's price.
Over the past 90 days, only 6 out of 61 Altcoins have outperformed Bitcoin, representing just 9% of the total analyzed.
In the last 14 days, the variation appears to be even more interesting: every two weeks, Altcoins have shown a higher upward movement than Bitcoin.
In the short term, analyzing a 1-hour timeframe with a 90-hour moving window, we observe that when Altcoins significantly outperform Bitcoin, it usually signals a potential market downturn. In other words, the Altcoin rally tends to be short-lived and is typically an indicator of risk and price correction for both Bitcoin and Altcoins in general.
Twitter (X): @Alphractal
Over the past 90 days, only 6 out of 61 Altcoins have outperformed Bitcoin, representing just 9% of the total analyzed.
In the last 14 days, the variation appears to be even more interesting: every two weeks, Altcoins have shown a higher upward movement than Bitcoin.
In the short term, analyzing a 1-hour timeframe with a 90-hour moving window, we observe that when Altcoins significantly outperform Bitcoin, it usually signals a potential market downturn. In other words, the Altcoin rally tends to be short-lived and is typically an indicator of risk and price correction for both Bitcoin and Altcoins in general.
Twitter (X): @Alphractal
đ”Currently, the total market cap of all stablecoins stands at $168 billion USD, representing 8.2% of the cryptocurrency market.
The dominance of stablecoins, especially USDT (Tether), follows an intriguing trendline that could signal local selling opportunities for Bitcoin and altcoins. When stablecoin dominance starts rising again, whether through new supply issuances or conversions of cryptos into stablecoins as a form of protection, it may indicate a shift in the market.
Tether (USDT) dominates the market, accounting for 70% of all stablecoins, while USDC takes second place with 20.8%.
The combined dominance of Bitcoin and all stablecoins currently sits at 65.2%, showing a low interest in altcoins. As long as this metric continues to rise, it suggests that we are not yet in an Altcoin Season.
Twitter @Alphractal
The dominance of stablecoins, especially USDT (Tether), follows an intriguing trendline that could signal local selling opportunities for Bitcoin and altcoins. When stablecoin dominance starts rising again, whether through new supply issuances or conversions of cryptos into stablecoins as a form of protection, it may indicate a shift in the market.
Tether (USDT) dominates the market, accounting for 70% of all stablecoins, while USDC takes second place with 20.8%.
The combined dominance of Bitcoin and all stablecoins currently sits at 65.2%, showing a low interest in altcoins. As long as this metric continues to rise, it suggests that we are not yet in an Altcoin Season.
Twitter @Alphractal
The cryptocurrency market sentiment is neutral to bullish. This means that investors and key technical metrics are experiencing a period of indecision about the real market sentiment, and this is likely to change soon due to the low market volatility!
Part of this sentiment comes from the traditional market, especially when analyzing the monthly correlation with major global indices. Indices like the S&P 500, Dow Jones, NYSE, and Russell 2000 are showing the highest levels of correlation in August 2024. A curious fact is the strong negative correlation with the CBOE Volatility Index, a popular measure of expected stock market volatility based on S&P 500 index options. It is calculated and released in real-time by the CBOE and is often referred to as the fear index or fear gauge.
Peaks in the CBOE Volatility Index have a stronger relationship with drops in the S&P 500 and occasionally form local bottoms in Bitcoin prices. These peaks can be unique or have continuity in volatility, requiring constant monitoring of this metric.
Part of this sentiment comes from the traditional market, especially when analyzing the monthly correlation with major global indices. Indices like the S&P 500, Dow Jones, NYSE, and Russell 2000 are showing the highest levels of correlation in August 2024. A curious fact is the strong negative correlation with the CBOE Volatility Index, a popular measure of expected stock market volatility based on S&P 500 index options. It is calculated and released in real-time by the CBOE and is often referred to as the fear index or fear gauge.
Peaks in the CBOE Volatility Index have a stronger relationship with drops in the S&P 500 and occasionally form local bottoms in Bitcoin prices. These peaks can be unique or have continuity in volatility, requiring constant monitoring of this metric.
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