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cointelegraph.com
Here’s why bulls aren’t buying the Bitcoin price dip to $50,000
Data shows pro traders are not buying the current Bitcoin dip as tomorrow’s $1.55 billion options expiry looms.
3 hours ago
Bitcoin ( BTC) has been bouncing at the $51,000 support for the past 44 days. Typically, this would be interpreted as a positive occurrence, especially considering that the $50,000 level represents a 75% advance in 2021.
However, cryptocurrency investors are typically short-term-focused and always overly optimistic. Thus, the current narrative for Bitcoin is slowly turning bearish but aside from sentiment, what story are the fundamentals telling?
However, there is a possibility that the recent drop has its roots in the $1.55 billion options expiry set to occur on April 23. As previously reported by Cointelegraph, bears have a $340 million advantage below $57,000. That could also explain why pro traders kept a neutral stance despite the 18% dip over the past eight days.
 Bitcoin price at Coinbase, USD. Source: TradingViewOn the other hand, some analysts such as Willy Woo have said that the Chinese coal mining accident caused the violent drop in Bitcoin's hashrate. This event, plus the electricity outage in China's Xinjiang region, may have reduced the Bitcoin network's processing power by 19%, and it exposed its heavy dependency on coal-driven energy.
While critics jumped in to bash Bitcoin, Coin Metrics co-founder Nic Carter produced a well-researched rebuttal to some of the key claims. Carter points out that Bitcoin mining, which is relatively portable, is concentrated in areas where electricity is unused and cheap.
Moreover, while the gold industry is environmentally destructive and diesel energy-dependent, Bitcoin mining can be fully powered by clean energy. Unlike precious metals, Bitcoin miners' portability allows the use of previously wasted oil and gas resources.
Whatever the case, pro traders haven't been adding positions during the recent BTC price correction.
Pro traders aren't selling but are also not buying at any price levelMajor cryptocurrency exchanges provide data on their top traders' long-to-short net positioning. This indicator is calculated by analyzing clients' consolidated positions on the spot, margin, and futures contracts. By doing this, it provides a clearer view of whether professional traders are leaning bullish or bearish.
It is important to note that there are occasional methodology discrepancies between various exchanges, so one should monitor changes instead of absolute figures.
 Exchange's top traders Bitcoin long-to-short ratio. Source: BybtThe chart above shows that top traders increased their exposure between April 14 and April 17, while the Bitcoin price was above $60,000. On the other hand, over the past five days, these whales and arbitrage desks remained relatively flat.
It is worth noting that the current 1.49 ratio favoring longs on OKEx remains lower than the 1.75 level seen on April 17. This data signals that top traders reduced their positions over the past five days.
A similar trend took place at Binance, where top traders net long-to-short ratio peaked at 1.25 on April 17. Albeit slightly favoring longs, the current 1.18 indicator sits at the lower range of the past three weeks.
Lastly, Huobi top traders added long positions between April 14 and April 18, but they kept a steady 0.90 ratio.
Therefore, there is no doubt that whales and arbitrage desks are not adding to their long positions even as BTC tests the $52,000 support with a 20% correction from the April 14 peak.
However, investors are encouraged to wait for Friday's options expiry before jumping to any fast conclusions.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Altcoins rally as analyst warns Bitcoin is in the '$50K – $60K twilight zone'
Ether, MKR and SOL rally to new all-time highs, while Bitcoin's price is stuck in what one analyst says is a range dominated by bots.
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The price of Bitcoin ( BTC) is still stuck in what traders hope will be a short-term downtrend as the impact of the April 18 rumors of a crackdown on “unnamed financial institutions” for facilitating money laundering using cryptocurrencies has yet to be shaken off.
Data from Cointelegraph Markets and TradingView shows that since being pummeled below the $51,000 level on April 18, the price of BTC has been trading in a range between $52,500 and $57,500 and establishing a descending pattern of lower highs and lower lows.
 BTC/USDT 4-hour chart. Source: TradingViewWhile regulatory concerns may have played some role in the current drawdown, there have been several other significant developments that have affected BTC's recovery.
According to Micah Spruill, managing partner and chief investment officer at S2F Capital, a 20% to 25% drop in the Bitcoin hash rate caused by mandatory power blackouts in the Xinjiang region of China over the weekend "forced approximately 80% of the miners in that area offline.”
Spruill sees this drop in hash rate, combined with an all-time high in the Bitcoin futures open interest rate as the catalyst for “the perfect scenario for a major over-leverage washout.”
In terms of what comes next for Bitcoin, Spruill pointed to an increase in bullish sentiment among analysts and traders “after much of the over-speculation in the market this month was tempered by the price pullback.”
Spruill said:
“Currently, the on-chain metrics are looking incredibly healthy with accelerating growth of new entities joining the network, increased user signups on major exchanges like Binance, and continued bullish net exchange outflows in both Bitcoin and Ethereum.” Bitcoin's current trading range may be dominated by botsDavid Lifchitz, chief investment officer of ExoAlpha, echoed Spruill's perspectives, also pointing to regulatory concerns in the United States and the announced ban on cryptocurrencies in Turkey as “the match that lit the fire of an overleveraged trading environment” based on the perpetual swaps funding rate before and after the plunge.
According to Lifchitz, Bitcoin is now back in the “$50,000 – $60,000 twilight zone,” which is characterized by institutional dip-buyers with orders at the $50,000 level, retail FOMO — the fear of missing out — above $60,000, and “trading bots playing ping-pong in the range in between.”
Since the drawdown, Lifchitz has identified a temporary support for BTC in the middle of the range, around $54,000 to $55,000, but still considers it “too early to say if the dip is over.”
Lifchitz said:
“Without any strong catalyst, breaking above $60k looks difficult at this time, and a break below $50k may drive Bitcoin down to $30k. Traditional markets showing signs of exhaustion may also put a dent on the crypto markets recovery.”Ethereum price hits a new highBitcoin’s current downtrend has opened the door for Ether ( ETH) to step into the limelight, with the top-ranked altcoin by market capitalization hitting a new all-time high at $2,644 on the back of $47.3 billion in trading volume.
 ETH/USDT 4-hour chart. Source: TradingViewEther’s rally was accompanied by a 25% rally in the price of Maker's MKR, one of the oldest decentralized finance projects on the Ethereum network, which reached a new all-time high of $4,980.
Solana's SOL has also been a strong performer as of late, surging 26% overnight to reach a new record high at $39.72.
The overall cryptocurrency market cap now stands at $2.02 trillion, and Bitcoin’s dominance rate is 49.6%.
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