Optimistic at BTC: Why leading traders are now hesitating to build a Bitcoin short position
From a technical point of view, Bitcoin is bearish in the opinion of many traders.
On-chain trends, according to which Miner and other major players have started to liquidate their holdings, show that 1K Daily Profit there is reason to believe that Bitcoin could take a step backwards.
However, several analysts comment that there is a key reason why they are hesitant to build a short position here: Inflows from Wall Street.
The entry of prominent Wall Street names into the crypto-asset space has made many hesitant to go short here. A hedge fund buying $1 billion worth of BTC, for example, would probably immediately invalidate any bearish pattern that might appear on the Bitcoin chart.
Why many traders are currently bullish on Bitcoin
A historically correct trader named „Bitcoin Jack“ is reluctant to shorten BTC now, after observing the institutional adoption of crypto currencies lately:
„One of the reasons I have given up the idea of taking another significant short position is because I don’t want to bet against the brute force of billionaires“.
He adds that while there are technical data that suggests that Bitcoin (Buy Now? Click here for instructions) has room to fall – but these signals can easily be cancelled out by the amount of capital flowing into the room:
„The reality is that I don’t know what will happen from here. Large flows of money are flowing into Bitcoin. Technical data suggesting that a downward trend is possible can be blown out of the water, while we should also remember that the institutional sector is not yet fully in control of Bitcoin“.
Only yesterday, an insurance company with at least $230 billion in assets under management made its first purchase of Bitcoin and purchased $100 million worth of the product.
Then, just an hour ago, MicroStrategy announced that the company was ready to buy $650 million worth of BTC in the coming weeks, which will almost certainly have an impact on the market.
Another trader known as „Mayne“ joins Jack’s concerns and asks his supporters if they think that „big players“ buying BTC will be enough to negate the bearish technical trends that are taking place on the charts.
I’ve been bearish on #Bitcoin near the highs based purely on TA.
Literally HTF SFPs on Eth and Btc at the top.
My TA says this can come back way lower, $11k-13k
With these large players buying in at these levels maybe this time it’a different?
What do you all think?
– Mayne of Tether (@Tradermayne) December 11, 2020
However, an emerging fundamental threat to the Bitcoin price development is the expectation of increased regulation.
Many believe that in the coming days or weeks the US government will introduce regulations that will make it extremely difficult for those who cannot identify themselves to interact with much of the crypto space.
Many on Twitter have already stated that if such regulation is released, the market could see a similar decline as in 2017, when BTC fell rapidly by 30 to 40 percent in a week – due to regulatory news.