BTC Longs on Bitinex have risen parabolically to at an all time high. Since 23rd November there has been an increase in Long positions equivalent to about $100m. Surely this is begging for an epic long squeeze?
Not so fast.. here are three reasons why this parabolic rise in Longs might not be what it seems.
1) The rise is on Bitfinex only. Funding rate on Bitmex is fairly neutral. This could suggest that one or a handful of massive players are responsible for this move. Do they know something we don't?
2) The pattern suggests steady accumulation of $100m of positions, starting neatly at the local low on 23rd November, which also lines up with the Golden Pocket (.618 to .65 retracements) of the current macro structure, which could be viewed as a retrace before new highs. See my post from yesterday "Beware The Pump."
Also, the three days of greatest increase since then match up neatly with re-touches to the .618 level also suggesting steady accumulation.
3) Assuming the first two points hold weight, the average accumulation price paid is probably around $7300, with some stops set possibly as low as $6618 (BITF). Either way, the bulk of a long squeeze may not hit until sub $7000, and so we may first need to get there without it.
Still on balance, I remain cautiously short.
Not so fast.. here are three reasons why this parabolic rise in Longs might not be what it seems.
1) The rise is on Bitfinex only. Funding rate on Bitmex is fairly neutral. This could suggest that one or a handful of massive players are responsible for this move. Do they know something we don't?
2) The pattern suggests steady accumulation of $100m of positions, starting neatly at the local low on 23rd November, which also lines up with the Golden Pocket (.618 to .65 retracements) of the current macro structure, which could be viewed as a retrace before new highs. See my post from yesterday "Beware The Pump."
Also, the three days of greatest increase since then match up neatly with re-touches to the .618 level also suggesting steady accumulation.
3) Assuming the first two points hold weight, the average accumulation price paid is probably around $7300, with some stops set possibly as low as $6618 (BITF). Either way, the bulk of a long squeeze may not hit until sub $7000, and so we may first need to get there without it.
Still on balance, I remain cautiously short.
