{"id":441363,"date":"2022-05-03T20:30:00","date_gmt":"2022-05-03T17:30:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/3-reasons-why-bitcoin-price-is-clinging-to-38000\/"},"modified":"2022-05-03T20:30:00","modified_gmt":"2022-05-03T17:30:00","slug":"3-reasons-why-bitcoin-price-is-clinging-to-38000","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/3-reasons-why-bitcoin-price-is-clinging-to-38000\/","title":{"rendered":"# 3 reasons why Bitcoin price is clinging to $38,000"},"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-6a4032af8413c\" 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-6a4032af8413c\" 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\/3-reasons-why-bitcoin-price-is-clinging-to-38000\/#%E2%80%9D_3_reasons_why_Bitcoin_price_is_clinging_to_38000_%E2%80%9C\" >&#8221; 3 reasons why Bitcoin price is clinging to $38,000  &#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\/3-reasons-why-bitcoin-price-is-clinging-to-38000\/#The_Bitcoin_futures_premium_is_muted\" >The Bitcoin futures premium is muted<\/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\/3-reasons-why-bitcoin-price-is-clinging-to-38000\/#Options_traders_remain_in_the_%E2%80%9Cfear%E2%80%9D_zone\" >Options traders remain in the &#8220;fear&#8221; zone<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/3-reasons-why-bitcoin-price-is-clinging-to-38000\/#Margin_markets_sustain_its_optimism\" >Margin markets sustain its optimism<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_3_reasons_why_Bitcoin_price_is_clinging_to_38000_%E2%80%9C\"><\/span>&#8221; 3 reasons why Bitcoin price is clinging to $38,000  &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div class=\"post-content\" data-v-2a0745c6>Bitcoin (BTC) has been unable to break from the 26-day-long descending channel. Investors are uncomfortable holding volatile assets after the United States Federal Reserve pledged to reduce its $9 trillion balance sheet.<\/p>\n<p>While inflation has been surging worldwide, the first signs of an economic downturn showed as the United Kingdom&#8217;s retail sales fell 1.4% in March. Moreover, Japan&#8217;s industrial production dropped 1.7% in March. Lastly, the U.S. gross domestic product fell 1.4% in the first quarter of 2022.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-05\/c9939d35-121f-4edd-ada2-439e2f29af49.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin\/USD price at FTX. Source: TradingView<\/em><\/figcaption><\/figure>\n<p>This bearish macroeconomic scenario can partially explain why Bitcoin has been on a downtrend since early April. Still, one needs to analyze how professional traders position themselves, and derivatives markets tprovide some excellent indicators.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"The_Bitcoin_futures_premium_is_muted\"><\/span>The Bitcoin futures premium is muted<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>To understand whether the current bearish trend reflects top traders&#8217; sentiment, one should analyze Bitcoin&#8217;s futures contracts premium, which is also known as a &#8220;basis.&#8221; <\/p>\n<p>Unlike a perpetual contract, these fixed-calendar futures do not have a funding rate, so their price will differ vastly from regular spot exchanges. A bearish market sentiment causes the three-month futures contract to trade at a 5% or lower annualized premium (basis).<\/p>\n<p>On the other hand, a neutral market should present a 5% to 12% basis, reflecting market participants&#8217; unwillingness to lock in Bitcoin for cheap until the trade settles.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-05\/9a2b3f98-fbbd-4015-8570-371286d0748e.png\"><figcaption style=\"text-align: center;\"><em>Bitcoin 3-month futures premium. Source: laevitas.ch<\/em><\/figcaption><\/figure>\n<p>The above chart shows that Bitcoin&#8217;s futures premium has been below 5% since April 6, indicating that futures market participants are reluctant to open leverage long (buy) positions.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Options_traders_remain_in_the_%E2%80%9Cfear%E2%80%9D_zone\"><\/span>Options traders remain in the &#8220;fear&#8221; zone<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>To exclude externalities specific to the futures instrument, traders should also analyze the options markets. The 25% delta skew compares equivalent call (buy) and put (sell) options. The indicator will turn positive when &#8220;fear&#8221; is prevalent because the protective put options premium is higher than the call options.<\/p>\n<p>The opposite holds when market makers are bullish, causing the 25% delta skew to shift to the negative area. Readings between negative 8% and positive 8% are usually deemed neutral.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-05\/9de7e538-6661-491e-901c-091165b424b9.png\"><figcaption style=\"text-align: center;\"><em>Deribit Bitcoin 30-day options 25% delta skew. Source: laevitas.ch<\/em><\/figcaption><\/figure>\n<p>The above chart shows that Bitcoin option traders have been signaling &#8220;fear&#8221; since April 8, just as BTC broke below $42,500 following a 10% drop in four days. Of course, such a metric could be reflecting the 16% negative BTC price performance over the past month, so not exactly a surprise.<\/p>\n<h2><span class=\"ez-toc-section\" id=\"Margin_markets_sustain_its_optimism\"><\/span>Margin markets sustain its optimism<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Margin trading allows investors to borrow cryptocurrency and leverage their trading position, thus potentially increasing returns. For example, a trader can buy cryptocurrencies by borrowing Tether (USDT) to increase their exposure.<\/p>\n<p>On the other hand, Bitcoin borrowers can only short the cryptocurrency as they bet on its price decline. Unlike futures contracts, the balance between margin longs and shorts isn&#8217;t always matched.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-05\/74ca0406-77bd-4ed2-ae45-bb6aa95925cb.png\"><figcaption style=\"text-align: center;\"><em>OKEx USDT\/BTC margin lending ratio. Source: OKEx<\/em><\/figcaption><\/figure>\n<p>The above chart shows that traders have been borrowing more Bitcoin recently, as the ratio decreased from 20 on April 30 to the current 12.5. The higher the indicator, the more confident professional traders are with Bitcoin&#8217;s price.<\/p>\n<p>Despite some additional Bitcoin borrowing activity aimed at betting on the price downturn, margin traders remain mostly optimistic, according to the USDT\/BTC lending ratio.<\/p>\n<p>Bitcoin traders fear further correction as macroeconomic indicators deteriorate because investors expect a potential crisis impact on riskier markets. However, there are no signs of leverage short (negative) bets using margin or futures, meaning sellers lack conviction at $38,000.<\/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\/3-reasons-why-bitcoin-price-is-clinging-to-38-000\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; 3 reasons why Bitcoin price is clinging to $38,000 &#8220; Bitcoin (BTC) has been unable to break from the 26-day-long descending channel. Investors are uncomfortable holding volatile assets after the United States Federal Reserve pledged to reduce its $9 trillion balance sheet. While inflation has been surging worldwide, the first signs of an economic&#8230;<\/p>\n","protected":false},"author":1,"featured_media":441364,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMDUvZjI4Y2JiMGUtMmEzOS00MDM4LTg1NDctZDk1NjE1NmI0NTY0LmpwZWc=.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74862,74972,81209,74937,74863,74860,75012,77595,74939,75592,3123,73785],"class_list":["post-441363","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin","tag-bitcoin-futures","tag-bitcoin-options","tag-bitcoin-price","tag-cryptocurrencies","tag-cryptocurrency-exchange","tag-derivatives","tag-lending","tag-market-analysis","tag-okex","tag-leverage","tag-markets"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/441363","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=441363"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/441363\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/441364"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=441363"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=441363"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=441363"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}