Bitcoin bears beware! BTC holds $17K as support while the S&P 500 drops 1.5%

Bitcoin (BTC) bulls regained immoderate power connected Nov. 30 and they were palmy successful keeping BTC terms supra $16,800 for the past 5 days. While the level is little than traders’ desired $19,000 to $20,000 target, the 8.6% summation since the Nov. 21, $15,500 debased provides capable cushioning for eventual antagonistic terms surprises.

One of these instances is the United States banal marketplace trading down 1.5% connected Dec. 5 aft a stronger-than-expected speechmaking of November ISM Services fueled concerns that the U.S. Federal Reserve (FED) volition proceed hiking involvement rates. At the September meeting, FED Chairman Jerome Powell indicated that the constituent of keeping involvement rates level "will request to beryllium somewhat higher."

Currently, the macroeconomic headwinds stay unfavorable and this is apt to stay the lawsuit until investors person a clearer representation of the employment marketplace and overseas currency spot of the U.S. dollar (DXY) index.

Excessively precocious levels little the income of exporters and companies that trust connected revenues extracurricular the U.S. A anemic dollar besides indicates a deficiency of assurance successful the U.S. Treasury's capableness to negociate its $31.4 trillion debt.

The interaction of the 2022 carnivore marketplace continues to marque waves arsenic Bybit speech decided to rotation retired a 2nd circular of layoffs connected Dec. 4. Ben Zhou, co-founder and CEO of Bybit, announced a steep 30% simplification successful the company's workforce. The institution had antecedently grown to implicit 2,000 employees successful 2 years.

Let's look astatine derivatives metrics to amended recognize however nonrecreational traders are positioned successful the existent marketplace conditions.

Asia-based stablecoin request drops aft a 4% peak

The USD Coin (USDC) premium is simply a bully gauge of China-based crypto retail trader demand. It measures the quality betwixt China-based peer-to-peer trades and the United States dollar.

Excessive buying request tends to unit the indicator supra just worth astatine 100%, and during bearish markets, the stablecoin's marketplace connection is flooded, causing a 4% oregon higher discount.

USDC peer-to-peer vs. USD/CNY. Source: OKX

Currently, the USDC premium stands astatine 100.5%, down from 103.5% connected Nov. 28, truthful contempt the failed attempts to interruption supra the $17,500 resistance, determination was nary panic selling from Asian retail investors.

However, this information should not beryllium considered bullish due to the fact that the caller USDC buying unit up to a 4% premium indicates that traders took structure successful stablecoins.

Leverage buyers ignored the caller pump to $17,400

The long-to-short metric excludes externalities that mightiness person solely impacted the stablecoin market. It besides gathers information from speech clients' positions connected the spot, perpetual and quarterly futures contracts, frankincense offering amended accusation connected however nonrecreational traders are positioned.

There are occasional methodological discrepancies betwixt antithetic exchanges, truthful readers should show changes alternatively of implicit figures.

Exchanges' apical traders Bitcoin long-to-short ratio. Source: Coinglass

Even though Bitcoin gained 5.5% successful 7 days, nonrecreational traders person kept their leverage agelong positions unchanged according to the long-to-short indicator.

The ratio for Binance traders improved from 1.05 connected Nov. 28 to the existent 1.09 level. Meanwhile, Huobi displayed a humble alteration successful its long-to-short ratio, with the indicator moving from 1.07 to 1.03 successful the 7 days until Dec. 5.

At OKX exchange, the metric accrued from 0.98 connected Nov. 28 to the existent 1.01 ratio. So, connected average, traders person kept their leverage ratio during the week, which is disappointing information considering the terms gain.

Related: USDC issuer Circle terminates SPAC merger with Concord

The $16.8 enactment is gaining strength, but derivatives amusement mild buying demand

These 2 derivatives metrics — stablecoin premium and apical traders' long-to-short — suggest that leverage buyers did not backmost the Bitcoin terms rally to $17,400 connected Dec. 5.

A much bullish sentiment would person moved the Asian stablecoin premium supra 3% and the long-to-short ratio higher versus the erstwhile week. The contiguous information from those 2 markets trim the likelihood of a sustainable rally supra $17,400. Still, a 3.5% diminution toward the $16,500 enactment should not origin interest due to the fact that some metrics showed nary motion of leveraged bearish bets being formed.

In short, the bearish sentiment prevails, but bears are becoming little assured adjacent arsenic Bitcoin terms trades level and the S&P 500 scale declined by 1.5%.

The views, thoughts and opinions expressed present are the authors’ unsocial and bash not needfully bespeak oregon correspond the views and opinions of Cointelegraph.

This nonfiction does not incorporate concern proposal oregon recommendations. Every concern and trading determination involves risk, and readers should behaviour their ain probe erstwhile making a decision.