Bitcoin Shorts Decline On Bitfinex, Players Brace For Upward Trend?

Reynaldo Marquez

1 year ago

2 mins read

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Bitcoin continues to move sideways as the week progresses. The benchmark cryptocurrency was pushed back from $40,000 levels and has been unable to bounce back to previous highs. However, BTC has been showing resilience as the traditional market seems to trend lower.

At the time of writing, Bitcoin trades at $38,830 with a 2% profit over the past week.

Bitcoin BTC BTCUSD — BTC moving sideways on the 4-hour chart. Source: BTCUSD Tradingview

The traditional market is facing major hurdles due to an increase in uncertainty coming out two fronts: the Russia-Ukraine conflict and the potential interest rates hike from the U.S. Federal Reserve (FED).

As a result, China’s stock market has experienced major losses over the past week. As a pseudonym analyst noted, equities from Mainland China saw a 3% loss yesterday alone. The situation has started presenting similarities to the 2008 economic crisis.

Hang Seng down nearly 5% only 5 mins into the session. Mainland down almost 3%. This coming off yesterday, the worst china session since '08. At what point do you call it a a crisis?

— TheLastBearStanding (@LastBearStandng) March 15, 2022

The U.S. stock market, as represented by the S&P 500, has also seen losses and has been trending to the downside since the start of 2022.

Over this period, Amazon presented a 15% loss, as did Apple, Microsoft an 18% loss, Tesla a 27%. These are only a few, but some of the strongest companies in traditional finances.

In the meantime, Bitcoin has displayed relative strength. Yes, it has been moving sideways but has held to its current levels despite the bearish price action in the stock market.

Bitcoin and equities were moving in tandem, operating as correlated assets. This is one of the narratives of this current cycle but seems to be losing strength as BTC’s price continues to defend its ground.

Bitcoin has been slowly moving upwards, even as traditional safe havens decline in short time frames. Gold has lost almost 2% of its value during today’s trading session, quickly after rallying north of $2,040.

Shorts Squeeze, More Profits In Sight?

Data provided by Wu Blockchain indicates a number of high-value players borrow money from crypto exchange platform Bitfinex. These players used their funds to open unprotected short positions.

Over 5,000 BTC were used to take loans and open shorts since March 10. However, over the past 12 hours, the positions have been trending lower.

According to datamish data, the BTC lent on Bitfinex is being returned, and the BTC borrowed by short sellers has dropped to 2,481, a drop of 49.5% in the past 24 hours. pic.twitter.com/fB4hSYO7nn

— Wu Blockchain (@WuBlockchain) March 15, 2022

Maybe these unprotected shorts were long in a different crypto exchange, maybe they closed their shorts as they noticed BTC’s price current price action.

In this current scenario, driven by fear due to the war in Ukraine and of more inflationary expansion, Bitcoin has seen an increase in its number of addresses with balances over $1,000.

More people seem to be using BTC to potentially hedge against the consequences of an extended conflict in Europe, to easily transport wealth between borders, to secure everyday items when banks collapsed.

These dangers are materializing in some parts of the world sending a warning to everyone paying attention. The need for BTC has never been more real.

Reynaldo Marquez

A literature major, Reynaldo Márquez has been deeply immersed in the crypto industry since 2017. His journey began with translating articles for various crypto news outlets, a role he took on with zeal. In 2018, amidst a challenging market, he embraced his first writing assignment, demonstrating his unwavering commitment to the nascent industry and the promise of change it bears for many people worldwide.
In March 2021, he joined the prestigious crypto news outlet NewsBTC and Bitcoinist, where he not only reported on the latest crypto news but also had the privilege of interviewing some of the industry's most influential figures. A year later, his dedication and hard work were recognized, and he was promoted to Managing Editor, a position he currently holds with pride.
He believes in honesty, good communication, hard work, and the power of cryptocurrency and its potential to transform people's lives, especially those alienated by the legacy financial system. Born in 1992 in Venezuela, Reynaldo is familiar with how governments and central banks can negatively affect people, their everyday lives, and their futures by creating inflation and erasing their hopes for a better future. Thus, like many Venezuelans, he embraced this new technology to help him and his family navigate difficult times.
In another life, Reynaldo would have pursued a career as an investigator, most likely tracking down the origins of the Cyberpunk movement with the publication of William Gibson’s ‘Neuromancer.’ The intersection between fiction and reality, with the materialization of Bitcoin in 2009, would have allowed him to dive deep into the crypto sphere as something more than a financial phenomenon but also a cultural shift in society that was brewing since the XX century, and maybe even sooner, in the XIX century with the publication of Henry David Thoreau’s ‘Civil Disobedience.’
But that’s for another life. In this one, Reynaldo has been trading to improve his trading skills. Since 2023, he has been trying to learn Python to create successful strategies and find ways to execute them. It is a difficult task, which continues to keep him busy today and will most likely continue to keep him busy in the near and long term.
In his free time, he enjoys lifting heavy objects, reading, watching movies, and listening to his favorite music. Some of his favorite authors are Walt Whitman, William Faulkner, Allen Ginsberg, James Baldwin, Raymond Carver, Ray Bradbury, George Orwell, Mario Vargas Llosa, Reinaldo Arenas, Rafael Cadenas, and many others. Lately, he has been primarily interested in reading about dystopic societies, a topic that deeply resonates with the crypto industry.
Since 2023, he has lived in Spain with his wife. He loves the weather, the food, and the people and their culture. They both expect to travel much more within the country they now call home and beyond its border. He hopes to retire with his wife, maybe in a quiet place near a beach, but most likely in a city close to a library and a university with his kids and, hopefully, grandkids.

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