Professional traders are accumulating the current fall in the price of Bitcoin. While retail investors are busy trading altcoins.
Indeed, Bitcoin has struggled to stay at $ 55,000 for the past 16 days. Also, the rejection that took place after the all-time high of $ 64,900, had a devastating impact on sentiment among retail traders.
However, despite the recent low performance of Bitcoin and the current 6.5% drop, professional traders have been buying the fall for 24 hours.
These whales and the movements of the refereeing table are reflected in the long / short futures ratio of OKEx. As well as in the Bitfinex margin lending markets.
When this purchase occurs, retailers are mostly quiet, which is reflected in the perpetually neutral financing rate.
As the graph shows, the 8-hour funding rate for perpetual futures has been below 0.05% over the past two weeks.
For month-end contracts, prices differ significantly from regular spot Exchanges, reflecting the imbalance in the leverage of long and short positions. This discrepancy is the reason why retail traders tend to prefer perpetual futures.
Professional traders buy the falling price of Bitcoin
On the other hand, the long / short indicator of professional traders reach their highest level in 30 days, indicating activity of buying whales and arbitrage tables.
In fact, this indicator is calculated by analyzing the consolidated position of the customer in spot, perpetual and future contracts. As a result, it offers a clearer view of the upward or downward trend of professional traders.
Specifically, the current supply / demand ratio of OKEx futures contracts currently favors long positions by 94%. This buying activity was launched in the early hours of May 4, when Bitcoin fell below $ 55,000.
However, to confirm whether this movement is widespread, margin markets should also be assessed.
All in all, there is no doubt that professional traders are super optimistic despite the current decline of Bitcoin. For their part, when it comes to the lack of appetite of retail traders, they currently seem to be focusing on altcoins.
Most importantly, this article is for informational purposes only and does not represent an investment recommendation. Always do your own research.
I close with this phrase from David Grider: «We are facing a period of cooling, before resuming the climbs».