The phone went dead?Before falling below $32,000, Bitfinex shorts closed a batch of Bitcoin shorts


Bitcoin prices are still at a standstill, trading at close to $33,000, and falling into a downward trend, and this trend seems to get worse over time. As the price plummeted, analysts consulted several technical and on-chain indicators to explain the price plummet, but none of these indicators found the exact cause.

One area of ​​interest is the sharp increase in Bitfinex short positions in the past week. Traders pay too much attention to these bitcoins (Bitcoin) Margin short positions are as if they are predictors of current market crashes.Nonetheless, as Cointelegraph previously reported, analysts forgot Bitcoin margin bulls are usually much larger.

On June 18, there were more long positions than Bitfinex short positions by at least 22,800 BTC, but 87% of short positions were closed before June 22. Currently, the margin long position is 43,850 BTC higher than the short position.

Although these shorts are usually savvy traders, they are unlikely to know in advance that Chinese banks will prevent their customers from participating Activities involving crypto trading or mining.

More importantly, these bearish positions are in MicroStrategy bought $500 million in Bitcoin After successfully obtaining a private placement of senior secured notes.To make matters worse, Michael Saylor’s business intelligence company announced its intention to Raise another $1 billion by selling shares Buy bitcoins.

Let’s see how these brave shorts perform.

Bitfinex margin short (blue) and Bitcoin price in USD (orange). Source: TradingView

On June 6, short positions increased from 1,380 to 6,700, with an average price of $36,150. Three days later, when the Bitcoin transaction price was $37,050, another 12,180 short positions were added. Finally, between June 14th and 15th, short positions increased by 6,000, reaching a peak of 25,000, while the average price of Bitcoin was $40,100.

By looking at the Bitcoin price when these short positions increase, it is reasonable to assume that the average price of 23,500 contracts increase (green circle) is $37,625.

related: After Bitcoin futures enters the spot premium, traders look for bearish signals

Traders close their positions before BTC plummets by $32,000

These short positions have been steadily closed over the past three days, when Bitcoin was trading at less than $37,000. However, when the price fell below $33,500, 17,000 short contracts had been closed. Therefore, it is unbelievable that the average price is less than $34,500.

No one will complain about 8% of revenue and short the market to generate $73 million in profits. However, it must be noted that on June 16, when Bitcoin reached $40,400, these shorts fell by $65 million underwater.

The analysis shows that even highly professional traders can go deep into the sea. There is no way to know whether the deal would be profitable if the blow to China did not increase the price of Bitcoin, or whether MicroStrategy managed to raise $1 billion before the price fell.

If anyone still believes in market manipulation, it is comforting to at least know that professional traders may also face huge losses. However, unlike us mortals, whales have strong financial resources and patience, and can withstand even the most violent thunderstorms.

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