- Bitcoin has been caught within a firm uptrend that has allowed it to shatter its correlation with the stock market as it continues marching higher
- Despite the overt bullishness of this move, funding rates have been on the brink of being negative on many major trading platforms
- This shows that demand for short positions remains high, and that traders are widely trying to time its top
- Furthermore, this trend is observed while looking towards Bitcoin’s long versus short ratio on major exchanges
- This means that Bitcoin could continue rallying, using these short positions as fuel for a strong move higher
Bitcoin and the entire crypto market have been caught in the throes of a sideways trading bout throughout the past couple of days.
BTC has been unable to shatter the heavy resistance that sits just above its current price, with buyers and sellers both being unable to gain any serious control over its near-term outlook.
However, its mid-term market structure remains highly bullish, which could indicate that further upside is imminent in the coming few days.
For this potential rally to come to fruition, bulls must break the heavy resistance in the lower-$13,000 region.
One trader believes that a growing number of short positions could act as rocket fuel for the next move higher.
Bitcoin Struggles to Break Key Resistance as Consolidation Phase Persists
At the time of writing, Bitcoin is trading down marginally at its current price of $12,950. This is around where it has been trading throughout the past few days.
If it cannot surmount the resistance between $13,11 and $13,500, it may continue seeing stagnating growth in the near-term.
A break above this region would put a move to significantly higher highs on the table.
Analyst: Growing Number of Short Positions to Bolster BTC
While sharing his thoughts on Bitcoin’s near-term outlook, one analyst explained that Bitcoin’s market structure is overtly bullish, but the composition of long and short positions doesn’t reflect this.
He contends that this could mean there is serious room for further upside.
“I realized just now that there is a strong case to be made that we continue going parabolic a bit longer. Price is higher than during the previous range (July-August), yet the market isn’t nearly as overly bullish as then… Price is higher, yet the market isn’t as bullish.”
Image Courtesy of Byzantine General.
Which direction Bitcoin will trend throughout the rest of the year will likely grow clear in the coming few days, as it is currently trading near a pivotal level.
Featured image from Unsplash. BTCUSD pricing data from TradingView.