{"id":427521,"date":"2022-04-06T20:19:34","date_gmt":"2022-04-06T17:19:34","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/bitcoin-price-drops-to-43-5k-but-data-and-btcs-market-structure-project-strength\/"},"modified":"2022-04-06T20:19:34","modified_gmt":"2022-04-06T17:19:34","slug":"bitcoin-price-drops-to-43-5k-but-data-and-btcs-market-structure-project-strength","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/bitcoin-price-drops-to-43-5k-but-data-and-btcs-market-structure-project-strength\/","title":{"rendered":"# Bitcoin price drops to $43.5K, but data and BTC\u2019s market structure project strength"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a3f91848b431\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a3f91848b431\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoin-price-drops-to-43-5k-but-data-and-btcs-market-structure-project-strength\/#%E2%80%9D_Bitcoin_price_drops_to_435K_but_data_and_BTCs_market_structure_project_strength_%E2%80%9C\" >&#8221; Bitcoin price drops to $43.5K, but data and BTC\u2019s market structure project strength  &#8220;<\/a><ul class='ez-toc-list-level-2' ><li class='ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoin-price-drops-to-43-5k-but-data-and-btcs-market-structure-project-strength\/#Futures_markets_show_traders_are_uncomfortable_near_47000\" >Futures markets show traders are uncomfortable near $47,000<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/bitcoin-price-drops-to-43-5k-but-data-and-btcs-market-structure-project-strength\/#Options_traders_worry_about_downside_risk\" >Options traders worry about downside risk<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_Bitcoin_price_drops_to_435K_but_data_and_BTCs_market_structure_project_strength_%E2%80%9C\"><\/span>&#8221; Bitcoin price drops to $43.5K, but data and BTC\u2019s market structure project strength  &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div class=\"post-content\" data-v-2a0745c6>Bitcoin (BTC) has been struggling to break the $47,000 resistance and even with April 6\u2019s drop below $44,000, there is still mounting evidence that the market structure is healthy.\u00a0<\/p>\n<p>On Dec. 3, 2021, Bitcoin initiated a 25.6% correction that lasted 18 hours and culminated with a $42,360 low. Four months later, the price remained 18% below the $56,650, closing on Dec. 2, 2021.<\/p>\n<p>Much has changed over that period, and hard evidence comes from other sections of the sector. Between February 15 and April 2, 2022, enterprise software development firm MicroStrategy announced the acquisition of 4,197 Bitcoin. <\/p>\n<p>Inflows to Canadian Bitcoin exchange-traded funds (ETFs) also hit an all-time high, according to data from Glassnode. These investment vehicles in Canada have increased their holdings by 6,594 BTC since January to a historical high of 69,052 BTC under management. The Purpose Bitcoin ETF, a spot instrument, currently has $1.68 billion worth of assets.<\/p>\n<p>Among the wave of recent buyers is Terra\u2019s Luna Foundation Guard (LFG), which is on a mission to acquire $3 billion worth of BTC as a reserve for TerraUSD (UST) stablecoin.<\/p>\n<p>CoinMetrics data shows that the active on-year Bitcoin supply reached 36.8% on April 5, its lowest level since September 2010.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-04\/312a10dc-8ac6-4464-a5d5-76cb7f0e146d.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin trailing 1-year active supply. Source: CoinMetrics<\/em><\/figcaption><\/figure>\n<p>The chart shows how \u201cdiamond hand\u201d holders have not moved their coins over the past 12 months.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Futures_markets_show_traders_are_uncomfortable_near_47000\"><\/span>Futures markets show traders are uncomfortable near $47,000<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>To understand how professional traders are positioned, including whales and market makers, let&#8217;s look at Bitcoin&#8217;s futures and options market data. The basis indicator measures the difference between longer-term futures contracts and the current spot market levels.<\/p>\n<p>The Bitcoin futures annualized premium should run between 5% to 12% to compensate traders for &#8220;locking in&#8221; the money for two to three months until the contract expiry. Levels below 5% are extremely bearish, while the numbers above 12% indicate bullishness.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-04\/71dcca73-7358-4d00-a638-12c23a65d5a5.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin 3-month futures annualized premium. Source: Laevitas.ch<\/em><\/figcaption><\/figure>\n<p>The above chart shows that this metric dipped below 5% on Feb. 11, reflecting traders\u2019 lack of demand for leverage long (bull) positions. The sentiment changed on March 26 after the basis rate regained the \u201cneutral\u201d 5% threshold. Even though this occurred, there are no signs of confidence from pro traders, according to the futures premium. <\/p>\n<h2><span class=\"ez-toc-section\" id=\"Options_traders_worry_about_downside_risk\"><\/span>Options traders worry about downside risk<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Currently, Bitcoin seems to lack the strength needed to break the $47,000 resistance, but traders should use derivatives to gauge professional investor sentiment. The 25% delta skew is a telling sign whenever arbitrage desks and market makers overcharge for upside or downside protection.<\/p>\n<p>If those traders fear a Bitcoin price crash, the skew indicator will move above 10%. On the other hand, <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/general\/\" data-internallinksmanager029f6b8e52c=\"3\" title=\"General\" target=\"_blank\" rel=\"noopener\">general<\/a>ized excitement reflects a negative 10% skew.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-04\/b3c56fb8-8b1a-4e73-a3f1-00cd4708ee5f.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin 30-day options 25% delta skew: Source: Laevitas.ch<\/em><\/figcaption><\/figure>\n<p>Data shows that the skew indicator has been ranging between 0% and 8% since March 9. Albeit not signaling fear, these options traders are overcharging for downside protection. From the BTC options markets perspective, there&#8217;s a slightly higher risk for unexpected downward price swings.<\/p>\n<p>The neutral-to-bearish Bitcoin derivatives data offers an interesting opportunity for bulls. If somehow the $47,000 resistance is broken, this will be a surprise for most investors. Two positive effects will arise from that event: a short squeeze from derivatives markets and room for buyers to use futures for leverage.<\/p>\n<p>If Bitcoin\u2019s futures premium had been running above 10%, traders would face a much higher cost to add long (bull) positions. Bulls seem better prepared to deal with the $47,000 price resistance considering the sound market structure that is marked by the absence of exaggerated buyers\u2019 leverage and this provides better odds of success.<\/p>\n<p><em>The views and opinions expressed here are solely those of the <\/em><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/noshitcoins\"><em>author<\/em><\/a><em> 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.<\/em><\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/div>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/bitcoin-price-drops-to-43-5k-but-data-and-btc-s-market-structure-project-strength\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; Bitcoin price drops to $43.5K, but data and BTC\u2019s market structure project strength &#8220; Bitcoin (BTC) has been struggling to break the $47,000 resistance and even with April 6\u2019s drop below $44,000, there is still mounting evidence that the market structure is healthy.\u00a0 On Dec. 3, 2021, Bitcoin initiated a 25.6% correction that lasted&#8230;<\/p>\n","protected":false},"author":1,"featured_media":427522,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMDQvZGRlYTUyYjktYjU0OC00NzAyLTliNzAtYTczOWU2Y2JmOTJkLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74862,81209,74937,74863,74860,75012,75849,75846,74939,122847,122378,73785],"class_list":["post-427521","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin","tag-bitcoin-options","tag-bitcoin-price","tag-cryptocurrencies","tag-cryptocurrency-exchange","tag-derivatives","tag-etf","tag-futures","tag-market-analysis","tag-microstrategy","tag-terra","tag-markets"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/427521","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=427521"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/427521\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/427522"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=427521"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=427521"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=427521"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}