Factors That Will Prevent Bitcoin Rising

Factors That Will Prevent Bitcoin Rising

Market experts and cryptocurrency investors are divided in the direction the Bitcoin price chart will follow. Although the current situation in the Bitcoin network and macroeconomic developments seems to be in favor of Bitcoin right now, some indicators that may prevent it from rising worry those who are turning to the market. Bitcoin, which left its long-term stable table in July, went upwards and reached the highest level of 2020 in the middle of August. Although the leader managed to raise the value of the crypto currency above $ 12,000, it faced a resistance and is currently trading in the average band of 11,500 - 11,800. Although experts expect an increase in the price of Bitcoin, there are many factors that can prevent this increase, according to AMBCrypto.

Supply / Demand Balance of the Market

At the moment, the supply demands in the Bitcoin (BTC) market are determined by new investors and traders. Sufficient liquidity and demand in crypto money exchanges; the general situation in the market may be in favor of the bulls. Therefore, while watching the markets, it is necessary to look at the BTC amounts entering and leaving the stock markets. According to the chart published by Chainalysis, the BTC value entering the stock markets showed its highest point for this year with $ 1.25 billion on July 27 and the lowest point with $ 500 million on August 9. As can be seen, the BTC price entering the market can vary very quickly, although it takes about 10 days between them. With this fluctuating graph, sometimes demand may not meet supply, which can lead to a decline in volatility.

Decrease in Correlation with Gold

Bitcoin's market voltality has always been higher than gold. Therefore, there was a weak correlation between the two entities over a one-year period. However, recently, especially in the last month, the harmony between gold and BTC is more than 50% and both assets show a tendency to gain value. However, in the long term, gold prices may be in a more stable state and correction may occur.

DeFi Factor with Rising Market Cap

The DeFi market, in which Maker has a 21% share, has achieved a steady increase, increasing its market value in the last 90 days. DeFi's growing popularity continues to increase its market dominance significantly. Most BTC investors can enter DeFi's highly volatile market by giving up Bitcoin for a period of time in order to gain profit in the short term.

Increasing Open Positions

According to the table published by Skew, open positions in Bitcoin transactions are progressing at a record level. It can be seen as a good situation in the short term, but it can also be expected to have an adverse effect on the price increase in the long term. Although the excess of open options shows expectation and interest, traders can break their options before the expiry. Therefore, a decline in the volume of open positions can present a dangerous picture for us.

Decrease in Option Volume

A high volume of option transaction indicates that interest in BTC has increased on behalf of the process in which the option is granted. In other words, high volume indicates more interest and in this context, low option volume means another factor to be considered.

Bears Dominance in the Futures Market

Open positions in Bitcoin transactions are at the peaks, but it is unclear whether this trend will continue. If the rise in open positions stops and positions begin to be positioned in favor of the bears, it is possible for BTC to drop. The 45% sell and 13% call option in the bear position can also lead to a decline in the Bitcoin price if it continues to dominate over a broader term.