Bitcoin Bull Run: Leveraged Bets Fueling a Potential Price Surge
Is Bitcoin’s Bull Run Just Getting Started? Leveraged Bets Signal Big Moves Ahead
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The recent surge in Bitcoin’s price has caught the attention of analysts, with many pointing to a shift in investor behavior as a key driver. CryptoQuant analyst ‘crypto sunmoon’ has observed that the current bull market is being fueled by leveraged bets, particularly in derivatives markets.
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This trend is significant because it differs from previous market cycles where increased deposits were typically observed in spot exchanges during BTC bull runs.
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Leveraged Bets: A Catalyst for Bitcoin’s Growth?
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Leveraged bets involve using borrowed funds to amplify the size of an investment. For instance, with 2x leverage, a trader can open a position twice as large as their capital. In Bitcoin futures trading, this approach can be profitable during upward price movements but comes with inherent risks. If the market moves against their position, traders face potential losses called liquidation.
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The analyst notes that the inflow of Bitcoin into derivatives exchanges signals increased confidence among investors, suggesting a belief in further price gains. This confidence can create a feedback loop, where rising prices encourage more leveraged bets, further fueling the bull market.
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\”The bull market will continue as #bitcoin continues to be deposited into futures exchanges for leveraged bets using derivatives, rather than into spot exchanges for selling.\” – By @t0_god
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The recent surge in Bitcoin’s price, with an 8.2% increase over the past week and a current trading price of $71,804, highlights the increasing relevance of leverage. While BTC experienced a slight retracement from its recent 24-hour high of $73,562, it continues to maintain upward momentum. This steady price growth and leveraged inflows signal broader investor optimism regarding Bitcoin’s future price potential.
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According to the analyst, as long as Bitcoin continues to flow into futures exchanges rather than spot exchanges, the bullish sentiment will likely remain strong.
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Other Indicators Pointing Towards Continued Growth
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Leveraged bets are not the only metric suggesting a potential continuation of Bitcoin’s price increase. The Stablecoin Supply Ratio Oscillator (SSRO) has reached low levels not seen since 2022. This decrease indicates that more stablecoins are being converted to BTC, suggesting increasing demand for the asset.
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Technical analysis also supports a bullish outlook. Renowned crypto analyst Ali has highlighted that historically, BTC has increased to 1.618 and 2.272 Fibonacci retracement levels. If BTC follows a similar pattern this time, Ali predicts that the asset will surge to a price between $174,000 and $462,000.
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While leveraged bets, SSRO levels, and technical analysis all point towards a continued Bitcoin bull run, it’s important to remember that the cryptocurrency market is highly volatile. As always, investors should conduct their own research, understand the risks involved, and make informed decisions.
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Featured image created with DALL-E, Chart from TradingView