Bitcoin’s 55% short skew sparks debate: Hedge or hype?
Key Takeaways
Is it nonetheless too early to wager towards Bitcoin?
Shorts are piling up, however spot demand stays robust. With liquidity constructing, fading Bitcoin right here is daring. Nonetheless, the setup may set off a brief squeeze.
How are institutional flows impacting the market?
BlackRock’s IBIT ETF is absorbing 84% of this month’s $5 billion inflows, contrasting mid-August outflows, making leveraged shorting a dangerous play.
Is it nonetheless too early to maneuver towards Bitcoin [BTC]? Weekly, BTC’s exhibiting traditional post-ATH conduct. The final two ATHs at $123k and $124k in Q3 each printed crimson candles, averaging a -1.5% pullback.
An identical sample seems to be repeating.
After kicking off the week with the longest wick stretching to a $125k ATH, the candle is already 1.3% within the crimson, with the bottom wick reaching $119k. In brief, betting towards Bitcoin might be a strategically sound transfer.
Supply: Coinglass
Backing this up, derivatives stay skewed to the brief aspect, with 55% of positions betting towards Bitcoin. In reality, that’s a +4% soar from the day before today, marking the steepest brief skew we’ve seen in a month.
Furthermore, nothing underscores this greater than AMBCrypto’s current report, highlighting a large $420 million brief opened by an OG BTC whale at $120,678, exhibiting good cash is bracing for a repeat post-ATH flush.
Nonetheless, with BTC buying and selling at $121,600 at press time, that place is sitting on a 0.76% unrealized loss. That’s roughly $3.2 million bleeding on the books, reiterating the query: Is it nonetheless too early to wager towards BTC?
BlackRock bid turns the warmth up on Bitcoin shorts
Institutional outflows are hitting BTC ETFs as worry creeps in.
That mentioned, BlackRock’s IBIT spot ETF continues to be racking up straight inflows, taking 84% of this month’s $5 billion. Technically, that’s almost $4.2 billion flowing in, making IBIT a key bid and a serious catalyst for Bitcoin.
Notably, that’s a pointy divergence from mid-August, when IBIT made up 70% of $800 million in outflows, which slammed two weekly reds and despatched Bitcoin down 9% from its $124k all-time excessive.
Supply: SoSo Worth
Towards this backdrop, stacking leveraged shorts is a dangerous play.
Analyst Aixbt echoed the identical view, calling shorting into heavy ETF inflows and low profit-taking a “daring transfer,” with greed pushing merchants to wager on a fast pop reasonably than sustained draw back.
In reality, $120.96 million in brief liquidity is stacked round $121.8k, exhibiting how a lot near-term juice is piled up. Nonetheless, with bids nonetheless stable, BTC’s consolidation is shaping up as a bullish setup for a possible brief squeeze.
