Bitcoin's Drop to $26,000 Analyzed: Professional Traders Remain Bullish Amidst Decreased Liquidity and Volatility
Summary:
Analyst Marcel Pechman analyzes Bitcoin's recent drop to $26,000 in the latest episode of Cointelegraph’s The Market Report. The derivatives market analysis reveals no signs of professional traders going bearish. BTC liquidity and volatility decreased since the FTX collapse. Bitcoin futures premium settled at a neutral 6%, indicating balanced demand. The proposal for a common currency among BRICS nations is deemed unlikely to succeed. Macro analyst Lyn Alden suggests that using their own currencies for trade may weaken the USD and offers advice for crypto investors. Listen to the full episode on Cointelegraph Markets & Research YouTube channel.
Bitcoin's recent drop to $26,000 is scrutinized in the latest episode of Cointelegraph’s The Market Report. Analyst Marcel Pechman examines the derivatives market, finding no indications of professional traders turning bearish. While this doesn't guarantee a quick rebound to $29,000 support, it does reduce the likelihood of a prolonged correction. Pechman also presents a Kaiko data chart, revealing a significant decrease in BTC liquidity and volatility since the FTX collapse in November 2022. However, there are no signs of liquidity issues or heightened volatility worsening conditions after the 11.4% mid-August price drop, despite it being accompanied by the largest futures liquidations since November 2022. Following the recent crash, Bitcoin futures premium settled at a neutral 6%, indicating a balanced demand between leveraged longs and shorts. Correspondingly, BTC options skew remains neutral at -7% to 7%, suggesting reasonable downside protection prices. Pechman further discusses macroeconomic analyst Lyn Alden's view on the probability of a common currency proposal among BRICS nations (Brazil, Russia, India, China, and South Africa) succeeding. Both Alden and Pechman share the belief that this proposal is unlikely to be successful. However, Alden notes that if BRICS nations were to use their own currencies for foreign trade, it could weaken the United States dollar, providing unconventional advice for crypto investors. The full episode of The Market Report can be listened to on the new Cointelegraph Markets & Research YouTube channel, where viewers are encouraged to click "Like" and "Subscribe" to stay updated with the latest content.
Published At
8/23/2023 12:30:00 PM
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