Bitcoin Hedge Fund Net Shorts Rise to Record, Analysts Predict 30% Drop
Bitcoin (BTC), the world’s largest cryptocurrency, has faced significant selling pressure along with the broader cryptocurrency market. BTC lost support from $71,000 and fell to $68,500. Currently, Bitcoin price is trading at $69,404.43 with a market cap of $1.37 trillion.
Bitcoin Hedge Funds Net Short Positions at Record Level
Analyst Zerohedge reported a significant increase in Bitcoin hedge fund net shorts, reaching a new record high.
Zerohedge said: “A huge jump and a new record in Bitcoin hedge fund net shorts. These photos will make Volkswagen/GME look like amateur hour.”
This increase in net short positions indicates very bearish sentiment among hedge funds and the potential for significant market volatility if these positions are forced to unwind. This parallels historic short squeezes such as those seen in Volkswagen and GameStop (GME), and suggests a similar dramatic shift could occur in the Bitcoin market.
Once the rally in meme stocks ended, Bitcoin and the rest of the crypto market crashed. As soon as Roaring Kitty went live on Friday, GameStop (NYSE: GME) stock price dropped a whopping 41%.
Will BTC Price Correct Further?
Crypto analyst Ali Martinez identified a key support level for Bitcoin and highlighted its importance for the cryptocurrency’s future trajectory.
Martinez said, “The most important support level for Bitcoin is currently $68,500! “If BTC maintains this level, it can only go up from here.” According to Martinez, maintaining the $68,500 support level is vital for Bitcoin’s continued upward movement.
Courtesy: Ali Martinez
Prolonged bullish trends often lead to significant downward corrections. Historical data shows that a long upward phase is often followed by a rapid and sharp downward wave. Analyst Alan Santana predicts that this bearish wave could occur 2 to 2.5 times faster than the previous bullish rally.
He explained: “When the market is perceived to have exhausted its upside potential, investors are more likely to exit the market quickly. Unlike the gradual accumulation during the uptrend, selling during the correction occurs quickly, leading to a steep decline.”
✓ Share:
Bhushan is a FinTech enthusiast and has a good ability to understand financial markets. His interest in economics and finance draws his attention to the emerging Blockchain Technology and Cryptocurrency markets. He is in a constant learning process and motivates himself by sharing the knowledge he has acquired. In her spare time, she reads thriller novels and sometimes explores her culinary skills.
The content presented may contain the personal opinion of the author and is subject to market conditions. Do your market research before investing in cryptocurrencies. Neither the author nor the publication accepts any liability for your personal financial loss.
#Bitcoin #Hedge #Fund #Net #Shorts #Rise #Record #Analysts #Predict #Drop