Bitcoin and Ethereum, two of the largest cryptocurrencies, have recently experienced a period of stability after a series of price fluctuations. Bitcoin trading has significantly calmed down, with transaction volumes dropping from 70% to 50%, resulting in reduced volatility. However, this period of calm may be the precursor to a more eventful period.
In times of market consolidation, many traders prefer to accumulate long positions. Surprisingly, most traders have taken a bearish stance on Bitcoin and Ethereum, with the percentage of short positions against Bitcoin increasing from 49% to 54% in the past 24 hours. However, there is a potential positive development on the horizon.
Hong Kong-based spot ETFs for both Bitcoin and Ethereum are set to be launched next week, which could attract institutional capital inflows from Asia. This could potentially reverse the bearish trend surrounding these cryptocurrencies and work in their favor.
Bitcoin and Ethereum have shown a significant correlation in their price movements over the past few weeks. Both cryptocurrencies have experienced corrections in their prices, contributing to the prevailing bearish sentiment. Furthermore, the trading activity for both Bitcoin and Ethereum has decreased, indicating a slowdown in market activity. The MVRV ratio, which measures profitability, has risen for both cryptocurrencies, suggesting that most addresses holding these coins are in a profitable position. Additionally, there has been an increase in the number of long-term holders of Bitcoin.
At the time of writing this article, Bitcoin is trading at $63,340, while Ethereum is priced at $3,136. It has been noted that the $3,200 level is a critical resistance for Ethereum, meaning that surpassing this level could lead to further price gains.
It is important to note that the information provided in this article does not constitute investment advice. Cryptocurrencies are highly volatile and carry a significant level of risk. Investors should conduct their own research and exercise caution when dealing with these assets.