Futures markets for bitcoin are still moving backward. Collateralized Funds try to profit from this.
Investment firms decreased their open forever positions by 559 agreements last week, according to the Behaviour of Traders data. Long positions declined by 132 throughout the previous report, making this the second week in a row that they have decreased.
Currently, 31% of all open forever holdings on the CME (Chicago Mercantile Exchange) are held by investment firms, dropping from 43.4% one week earlier. The decrease only denotes that asset managers currently represent a smaller proportion of bullish traders on the CME. A weekly picture of job vacancies in the CME is provided via the Behavior of Traders report.
Collateralized funds, however, added 1,367 contracts to their long positions after adding 1,694 contracts earlier. Leveraged funds currently make up 51% of the long positions in margin calls and 30% of the long positions in long-term investors on the CME.
Asset management vulnerability to BTC prices will typically decrease as they have fewer open forever positions. Bitcoin’s price has fallen 20% for November during the recent slump, and it appears that a base of opposition is forming around $16,500.
Increased futures contracts for collateralized funds may result from funds purchasing futures contracts that are now trading at a premium to spot pricing. Backwardation is a state that typically indicates market bearishness.
Following what has been a protracted crypto winter, current bearish sentiment will continue to put pressure on BTC markets. Just 45% of the available Bitcoins are profitable at the moment, down from 70% at the start of 2022.
Nevertheless, Bitcoin’s supply-to-profit ratio has historically been lower, dropping to 43% in 2020 and as weak as 39% in 2015. In the past, drops in the profit percentage supply have indicated short-term market troughs for bitcoin.