Bitcoin short traders are seeing massive liquidation as the underlying asset continues its relentless parabolic advance. Meanwhile, analysts predict even higher returns for BTC in 2019 as the general market sentiment remains firmly bullish.
Short Squeeze Amid Parabolic Advance
Tweeting earlier in the week, Binance CEO Changpeng Zhao revealed that its first margin liquidation saw a hemorrhaging of bitcoin short positions. With price continuing to set new 2019 highs, it is unsurprising to see bets against bitcoin being liquidated on contract close-out.
According to Bloomberg, short bets on BTC are at an all-time high with net long positions declining steadily since the end of Q1 2019. Speaking to Bloomberg, Naeem Aslam of Think Markets UK said:
“It’s a clear sign that the price was going to knock them out. Now the momentum is immensely strong and we do think that the price is highly likely to touch the level of $15,000 in the next couple of weeks.”
Across multiple platforms, Bitcoin futures trading continues to set new all-time highs. Q2 2019 has seen the highest volume of open positions on BTC futures contracts with short bets steadily rising. Since the start of April, bitcoin has gained close to $9,000.
Commenting on the rising level of short bets, Bloomberg analyst Mike McGlone opined:
“Higher prices are bringing in more money, more hedging, greater shorts. Elevated shorts like this are indicative of a bid below the market more likely to go higher.”
Bitcoin Sees First Major Decline in over Two Weeks
Bitcoin is up more than 210 percent since the start of the year. Most of that gain has occurred between April and June 2019 with the top-ranked cryptocurrency experiencing a stellar Q2 2019.
After blowing past the mid-$11,000 region on the road to $13,000, BTC is currently experiencing its first significant price decline in more about 17 days. Bitcoin has slipped down to $11,600 as of press time, dropping more than seven percent over the last 24-hour trading period.
This decline appears to be a temporary market correction and sideways consolidation/accumulation after such a steep parabolic advance. If BTC holds above the $11,500 price level which offered considerable resistance before this last upward advance, then the pioneer cryptocurrency could be in line for another surge towards the $15,000 price level.
Analysts like Tom Lee of Fundstrat believe that surpassing the $10,000 price mark was the trigger for the return of retail hype in the market.
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