Bitcoin Margin Long-Short Ratio at Bitfinex Hits All-Time High

A key Bitcoin price metric hit a new all-time high, but is it a bullish or bearish move?< /p> Market analysis
Sept. 12 will leave a mark that will likely remain for a long time. Traders on the Bitfinex exchange drastically reduced their leveraged Bitcoin (BTC) bearish bets and the lack of demand for shorts may have been caused by the expectation of fresh inflation data.

The bears may have lacked confidence, but August's US Consumer Price Index (CPI) beat market expectations and they seem to be on the safe side. The inflation index, which tracks a broad basket of goods and services, rose 8.3% from a year earlier. More importantly, the energy price component fell 5% over the same period, but was more than offset by rising food and housing costs.

Shortly after the release of the worse-than-expected macro data, US equity indices fell, with futures on the tech-heavy Nasdaq Composite Index slipping 3.6% in 30 minutes. Cryptocurrencies accompanied the deteriorating mood and the price of Bitcoin fell 5.7% over the same period, erasing the gains of the previous 3 days.

Identifying the market slowdown to a single inflationary measure would be naïve. A Bank of America survey of global fund managers had 62% of respondents saying a recession is likely, which is the highest estimate since May 2020. The research paper collected data the week of 8 September and was led by strategist Michael Hartnett.

Interestingly, while all of this is happening, Bitcoin margin traders have never been so optimistic, by one metric.
Margin traders soared from bearish positions
Margin trading allows investors to leverage their positions by borrowing stablecoins and using the proceeds to buy more cryptocurrency. On the other hand, when these traders borrow Bitcoin, they are using the coins as collateral for shorts, which means they are betting on lower prices.

This is why some analysts monitor the total amount of Bitcoin and stablecoin lending to understand whether investors are bullish or bearish. Interestingly, Bitfinex margin traders entered their highest...

Crypto Sep 14, 2022 0 62 Add to Reading List

Bitcoin Margin Long-Short Ratio at Bitfinex Hits All-Time High

A key Bitcoin price metric hit a new all-time high, but is it a bullish or bearish move?< /p> Bitcoin margin long-to-short ratio at Bitfinex reach the highest level ever Market analysis

Sept. 12 will leave a mark that will likely remain for a long time. Traders on the Bitfinex exchange drastically reduced their leveraged Bitcoin (BTC) bearish bets and the lack of demand for shorts may have been caused by the expectation of fresh inflation data.

The bears may have lacked confidence, but August's US Consumer Price Index (CPI) beat market expectations and they seem to be on the safe side. The inflation index, which tracks a broad basket of goods and services, rose 8.3% from a year earlier. More importantly, the energy price component fell 5% over the same period, but was more than offset by rising food and housing costs.

Shortly after the release of the worse-than-expected macro data, US equity indices fell, with futures on the tech-heavy Nasdaq Composite Index slipping 3.6% in 30 minutes. Cryptocurrencies accompanied the deteriorating mood and the price of Bitcoin fell 5.7% over the same period, erasing the gains of the previous 3 days.

Identifying the market slowdown to a single inflationary measure would be naïve. A Bank of America survey of global fund managers had 62% of respondents saying a recession is likely, which is the highest estimate since May 2020. The research paper collected data the week of 8 September and was led by strategist Michael Hartnett.

Interestingly, while all of this is happening, Bitcoin margin traders have never been so optimistic, by one metric.

Margin traders soared from bearish positions

Margin trading allows investors to leverage their positions by borrowing stablecoins and using the proceeds to buy more cryptocurrency. On the other hand, when these traders borrow Bitcoin, they are using the coins as collateral for shorts, which means they are betting on lower prices.

This is why some analysts monitor the total amount of Bitcoin and stablecoin lending to understand whether investors are bullish or bearish. Interestingly, Bitfinex margin traders entered their highest...