Selecting a timeframe for technical wringer is unchangingly a tricky topic, but usually, the longer the trend, the higher the odds it shall prevail. For example, those analyzing the 3-day Bitcoin (BTC) orchestration will unarguably identify an ascending waterworks pattern that initiated in late June.
Bears will moreover unchangingly find ways to justify their views despite the fact that Bitcoin has hit new all-time highs pursuit the United States consumer price surge to 6.2%, which is the biggest inflation surge in 30 years.
However, data from on-chain analytics firm Glassnode shows that long-term investors have stopped net stook and are now diversifying into altcoins. According to reviewer Willian Clemente, the recent net selling from that matriculation of investors was the first in 6 months, signaling a “sell into strength” move.
It is worth highlighting that the Bitcoin network was upgraded on Nov. 14 to modernize the scripting and privacy capabilities. From a trading perspective, this creates a potential “sell the news” event as the resurgence was largely expected by the community.
Data shows pro traders are neutral-to-bullish
To understand how bullish or surly professional traders are leaning, one should unriddle the futures understructure rate. This indicator is wontedly referred to as the futures premium and it measures the difference between longer-term futures contracts and the current spot market levels.
A 5% to 15% annualized premium is expected in healthy markets which is a situation known as contango. This price difference is caused by sellers taxing increasingly money to withhold settlement longer.
Notice the spike to 20% on Nov. 9, as Bitcoin piled 14% gains in 3 days. This unenduring period of excessive optimism retracted as BTC corrected 9% without the $69,100 all-time upper on Nov. 10.
Currently, the understructure indicator stands at a healthy 12%, signaling conviction from these traders.
Options traders are not as bullish
To exclude externalities specific to the futures instrument, one should moreover unriddle options markets.
The 25% delta skew compares similar undeniability (buy) and put (sell) options. The metric will turn positive when fear is prevalent considering the protective put options premium is higher than similar risk undeniability options.
The opposite holds when greed is the prevalent mood, causing the 25% delta skew indicator to shift to the negative area.
A skew indicator between -8% (greed) and 8% (fear) is considered neutral. Sept. 29 was the last time that indicator moved outside this range, reaching 10%. Curiously, that same day marked the end of a 23-day withstand movement that took Bitcoin from $52,700 on Sept. 6 to $41,000.
As for the current neutral 25% delta skew, it might be interpreted as a “glass half full” considering pro traders are somehow unfazed by the 95% gains year-to-date.
Data shows there is room for spare leverage from Bitcoin buyers, which ideally would see the price protract to trade within the ascending waterworks that was initiated in late June.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should self-mastery your own research when making a decision.