BTC/USD shorts are 10% down: what does this means for BTC prices?
After a pump on the 8th of February increased the market capitalization of Bitcoin all the way up to $67 billion, from around $59 about a week ago, it seems as if short positions are getting closed en masse.
The tweet below shos a chart displaying the sudden plunge in BTC/USD short positions, as about 10% of them were closed in a matter of a few hours:
$BTC/USD shorts on Bitfinex have taken a plunge today, now down over 10% in just the past few hours.#bitcoin pic.twitter.com/xOEEcPtj4N— CoinDesk Markets (@CoinDeskMarkets) February 13, 2019
The sign can be interpreted in several ways. The simplest explanation possible, is that short sellers have given up on a retest of the latest lows, and are putting their trust on another pump towards the range of $4,000, or at least prefer to wait for the market to take a new direction. This tweets by @TraderDaniel4k and @YarrPiratez resembles those two lines of thought:
Although it is a rather arbitrary metric looking at how much $ shorts there are on its own, it is the psychology behind why they are falling that interests me. Trading instincts are kicking in and big positions will be laddered into. 👨🏫👨🎓#BTC #Bitcoin $Crypto pic.twitter.com/Voo1jg6VuU— Daniel📈 (@TraderDaniel4k) February 13, 2019
#bitcoin shorts are nearing the lows once again. What could this mean?— Yarr The Crypto Pirate (@YarrPiratez) February 13, 2019
Usually when the shorts have reached the bottom area, the current price has been at the potential top and dropped quite drastically after that.
Sentiment is supporting sideways & down movement.$crypto #BTC pic.twitter.com/dRhRieczuR
However, there are also other possible lectures of the current short squeeze situation, as @Crypt0Entropy shows in this tweet:
$BTC outlook: Still looking grim. This move was so calculated & precise. Squeeze the shorts, trap the bulls. Exact same precise moves to diagonal resistance line drawn Jan 7th as the last move like this. That's no coincidence. Volume is weak & a big leg down is coming. #BTC pic.twitter.com/K7ZNKJ0wYH— Crypto Entropy (@Crypt0Entropy) February 13, 2019
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