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Bitcoin Shorts Continue to Dissipate as Crypto Correction Continues

2 mins
Updated by Adam James
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On November 11, the Bakkt Bitcoin futures market almost reached an all-time high in volume, closing the day at $13.8 million. This was slightly lower than the actual all-time high of $15.5 million, reached on November 8.
While Bakkt is performing exceptionally well, especially compared to its volume in early October, the interest in Bitcoin from institutional investors has been dissipating. This has been especially visible in the CME market, whose volume has returned to 2018 levels. The Bitcoin price, however, has created a bullish trading structure and looks likely to break out eventually. Crypto trader @CanteringClark stated that since the majority of shorts have been closed, this might not be the best position to initiate short trades. Also, he noted that this is the fifth week in a row in which the delta has been negative. Since the price has increased during this time, numerous shorts have likely been liquidated. Option delta is used to measure the sensitivity of the price of the option to a change in the underlying asset price. A negative delta is present in short calls and long puts, while a positive one in long calls and short puts. To simplify, a negative delta is present when the investor believes the price of the underlying will decline and vice versa. The tweet alludes that if the Bitcoin price gets to the $8300 level, he will look to initiate longs. The $8300 level is also the month of October price open. Let’s look at the price movement and see if it will get there.

Bitcoin Descending Wedge

The Bitcoin price has fallen to the support area at $8600. Furthermore, it seems to be trading inside a descending wedge, which is considered a bullish pattern. Currently, it is trading right on the support line of the wedge. Bitcoin Looking closer at the price movement, we can see bullish divergence developing in the RSI. This makes it likely that the price will break out from the wedge. This hypothesis is strengthened by the presence of long lower wicks and the fact that the price is trading inside a significant support area. Bitcoin Bullish Divergence

$8300 Level

The $8300 price level coincides with the next minor support line. Additionally, using the volume profile indicators, we can see that there is strong support all the way to $8000. However, a breakdown from the wedge would be required for the level to be reached. Bitcoin Volume Profile
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
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In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

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Valdrin Tahiri
Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona School of Economics. Shortly after graduating, he began writing for several different cryptocurrency related websites as a freelancer before eventually taking on the role of BeInCrypto's Senior Analyst. (I do not have a discord and will not contact you first there. Beware of scammers)
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