Crypto Traders Step Up Purchases as Bitcoin Price Dips Below $88K
Traders are increasingly buying Bitcoin (BTC) on the Kraken platform as prices have slipped to a three-month low. According to Kraken’s Head of Derivatives, Alexia Theodorou, this buying trend reflects a risk-off sentiment as the price fell below $88,000.
BTC’s decline occurred shortly before publication as Nasdaq futures indicated ongoing risk aversion on Wall Street, and the Japanese yen maintained its strength against the U.S. dollar, suggesting haven-seeking behavior.
Key Insights:
- Traders are purchasing Bitcoin as sentiment shifts, lifting the long-short ratio to 0.8—the highest on record for the exchange.
- The recent dip in Bitcoin’s price is following a $1 billion increase in open futures positions on Binance, likely driven by traders preparing for further price declines.
“The long-short ratio has climbed to a record high of ~0.8, indicating traders may be expecting a rebound as they effectively ‘buy the dip,’” Theodorou stated. However, despite this surge in buying, the ratio remains below 1, indicating more short positions exist compared to long ones on the platform.
“While this speaks to positive sentiment, normal liquidation levels suggest there might still be excess leverage in the market, which could lead to vulnerabilities in the near future,” Theodorou added.
