The crypto market has been shaken by massive positive sentiment from the global scene lately. First comes from asia, where japan just officially passed a bill paving the way for crypto ETFs while slashing crypto taxes drastically from 55% to just 20% only. This aggressive move definitely makes the united states, which is still struggling with their regulations, look lagging far behind. Not long after that, the corporate giant microstrategy also reaffirmed their commitment to keep buying $BTC for the long term to maintain their throne as the largest corporate BTC holder in the world without caring about the current market volatility.
This fresh fundamental sentiment immediately sparks a burning enthusiasm in the derivatives market. If we peek at the latest data, the long or short position ratio on giant exchanges like binance and OKX shows a strong dominance of market players taking long positions with ratio numbers ranging between 1.17 to 1.47. However, this overly high optimism took some victims because there was around $58.78 million of total futures positions hit by liquidation within the last 24 hours, with the majority of victims dominated by short sellers who got run over by the upward momentum. This bustling futures trading is also reflected in the daily transaction volume on binance which touched a fantastic figure of $12.39 billion, followed by OKX with transactions of $6.38 billion.
If we shift to other supporting indicators like the funding rate from coinglass, the thick green area clearly dominates the movement from june to july. This indicates that long position holders are very aggressive and willing to pay premium fees to maintain their positions in the market. In addition, spot and futures trading volume surged quite significantly in mid july after being sluggish for several days prior. This volume increase accompanied by BTC price creeping up to the $64.950 level reinforces that this buying pressure is based on real accumulation by market players, not just temporary price manipulation.
Looking at the daily chart structure on TradingView, the current price movement is facing head on with the SMA 50 line while the ztochastic indicator has started to creep upward and show signs of being overbought. On that chart, we can also see that the daily transaction volume is still fluctuating but there is a buying pressure effort trying to maintain the price position so it does not drop deeper below its moving average.
My Opinion
For fellow traders wondering if this nearest resistance area will be broken in a single go, the price will likely consolidate or experience a healthy correction first. This temporary drop is needed to retest the fair value gap or FVG area before later gathering new strength to test the next strong resistance area which lies in the price zone range between $73.060 to $74.265.
Source
Posted Using INLEO
