Bitcoin hits new highs in the absence of ‘unhealthy’ use – will the rally continue?
Key Takeaways:
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Spot bitcoin ETF inflows and low leverage suggest that the BTC rally has a room to grow.
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US Federal Reserve Liquidity and Weak Bond Sales support a Bitcoin Push beyond $ 110,000.
Bitcoin (Btc) did not maintain its bullish momentum after reaching a new all-time high of $ 109,827 on May 21, which led to entrepreneurs to ask if the derivatives market had mainly pushed the rally. From a broad perspective, the $ 77 billion in Bitcoin Futures Open interest is undoubtedly a role. However, a closer look at the data shows a more positive outlook for further price acquisitions.
The current 7% annual premium of Bitcoin futures is fixed within a neutral range of 5% to 10%, which has been common in the last two weeks. This indicator can easily exceed 30% in periods of strong optimization, so the current level is relatively low. At the same time, lack of excessive action reduces concerns about a rally driven especially by derivatives.
Balanced order of books and spots bitcoin etf inflows point in spot-driven rally
For comparison, in the previous Bitcoin $ 109,346 all-time high on January 20, the annual premium futures reached 15%, showing a higher level of leveraged bullish positions affecting the price. Therefore, the current Bitcoin derivatives market appears to be healthier, suggesting strong demand in market markets.
During the January Bull Run, the price of Bitcoin in Coinbase was exchanged with a premium compared to other exchanges. The so-called Coinbase Premium is not present right now, which means the purchase of pressure is more evenly spreading-a sign of a healthy market.
While excessive purchase pressure on a single exchange is not necessarily bearish, it is easier to overcome uncertain price increases when low liquidity. This data supports the idea that derivatives markets are not the main drivers of recent price increases.
In addition, $ 1.37 billion in net inflows to see funds exchanged by the Bitcoin (ETF) exchange in the United States between May 15 and May 20 which further suggests that consumers, rather than derivatives, is the main force behind the rally.
Despite the lack of convincing in bitcoin futures, many indicators point to further upside down. Forced liquids The Bearish BTC futures position is relatively less than $ 170 million between May 18 and May 21, cementing the idea of a rally -driven area. In comparison, the rally up to $ 104,000 on May 9 rallied $ 538 million in destruction for three days.
On May 21, the Bitcoin Options markets showed a slight increase in demand for Put (Sell) options, but nothing was unique. For the comparison, the put-to-call ratio in the derivit dropped to 0.4X in the previous Bull Run on January 20, reflecting lower confidence due to reduced call options (buy).
The upward movement of bitcoin may be limited to macroeconomic factors, especially as tariff war continues. However, the potential for the price to reach $ 110,000 and higher is partly based on the weak position of the US Federal Reserve. Injection of liquidity It may alleviate recession concerns, but it also reduces the appeal of government bonds, favors risk-on assets such as Bitcoin.
This article is for general information purposes and is not intended to be and should not be done as legal or investment advice. The views, attitudes, and opinions expressed here are unique and do not necessarily reflect or represent the views and opinions of the cointelegraph.
