The price of Bitcoin is gathering upward momentum as traders buy fewer put options, which are bearish bets on the highest cryptocurrency.
At press time, bitcoin was changing hands near $ 9,400, representing a 2% gain on the day, according to CoinDesk’s Bitcoin Price Index. Weekly, the cryptocurrency now reports over 8% earnings.
A rise in demand for giving options coincides with the recent rise of Bitcoin prices. Such derivative contracts give the holder the right to sell the underlying asset at a predetermined price at or before the predetermined rate. In the meantime, a call option gives the holder the right to buy,
The one-month call-to-call trend, which measures the price of a put relative to the price of calls, is currently down at 6.6%, down from its multi-month high of 22% on May 22, according to data and The research provided crypto derivatives Strong Skew.
The metric fell sharply from 15% to 5% on Wednesday as prices rose by $ 9,000. This confirms an innovative analysis of technical charts. Essentially, demand for put options, or bearish bets, has declined as prices rise.
“The decline in leverage is associated with a higher perceived halving risk since mid-May, causing higher skews,” said Luuk Strijers, COO in exchange of cryptocurrency Deribit derivative. “Now the market seems less concerned about further downward movements reducing demand for mail.”
Options put in more demand after the May 11 prize halved, pushing the one-month skew higher to 20% from 12%. This was possibly due to fears that the cryptocurrency would witness a price disadvantage similar to the 30% decline seen in the four weeks following the second halving, which occurred on July 9, 2016.
A 9% correction occurred last week with prices falling from $ 9,950 to $ 8,660. The cryptocurrency defaulted to levels below $ 8,700 several times earlier this week before jumping back above $ 9,000.
Dip call
As bitcoin fell from $ 10,000 to $ 8,630 in the seven days to May 25, the number of addresses holding at least 100 BTC rose from five-year lows, according to data provided by Glassnode.
“Once again, the big players appear to be piling up to the dip,” analysts at blockchain intelligence firm Santiment noted in a blog post.
The number of referrals rose from 16,010 to 16,089 during the price decline, an indication of dip demand and investor belief in the long-term bullish story. The number of addresses with at least 0.01 BTC and 0.1 BTC reached record highs during the recent price. drop.
Technical charts now indicate scope for a rally toward resistances lined up at $ 9,850 and $ 10,000.
4 hour and daily charts
Bitcoin has invalidated the bearish bearish highlights pattern on the four-hour chart with a convincing move above $ 9,310 (horizontal line). With that in mind, the positive view put forward by the wedge cutting collapse on Wednesday has earned acclaim.
The cryptocurrency could rise further to resistance set at $ 9,875, the upper end of the narrowing price range seen on the daily chart. Closing above that level would signal a resumption of the rally from the lowest of $ 3,867 observed in March.
Meanwhile, the lower end of the narrow price range is the level to beat for sellers.