After a failed rally above $31,000 on June 23, Bitcoin has sustained the $30,300 resistance for the past three days. Curiously, this happened while gold reached its lowest level in three months, trading at $1,910 on June 22, down from a $2,050 peak in early May. Investors now question how solid Bitcoin’s $30,000 support is. Analyzing what caused the recent price rally is essential to understanding how traders are positioned on BTC margin and futures markets.
Some analysts attribute Bitcoin’s recent 21.5% gains in 11 days to BlackRock’s spot Bitcoin exchange-traded fund (ETF) filing. Other events, such as HSBC Bank in Hong Kong reportedly introducing its first local cryptocurrency services using three listed crypto ETFs and ProShares Bitcoin Strategy ETF experiencing its largest weekly inflow in a year at $65 million, might have fueled the cryptocurrency gains.
Moreover, the U.S. crypto regulatory environment may be improving after a period marked by enforcement actions from the Securities and Exchange Commission (SEC) aimed at exchanges supposedly operating as unregistered securities brokers. Federal Reserve governor Michelle Bowman recently stated that financial institutions had been left in a “supervisory void” in terms of emerging technologies, including digital assets. Policymakers have been relying on “general but non-binding statements,” leaving substantial uncertainty and imposing new business requirements after significant investments have been made.
In response, a draft bill in the U.S. House of Representatives aims to prohibit the SEC from denying digital asset trading platforms registration as a regulated alternative trading system. The proposed legislation would allow such firms to offer “digital commodities and payment stablecoins.“
Analyzing Bitcoin derivatives metrics can provide insight into how professional traders are positioned amid improved regulatory perspectives and sizable institutional inflow. OKX stablecoin/BTC margin lending ratio reveals an improvement over the past four days, with the current 24x ratio favoring bullish stablecoin lending. Meanwhile, top traders at various exchanges like Huobi and Binance have been increasing their long positions as the Bitcoin price broke above the $30,000 resistance.
Overall, Bitcoin bulls have added leverage-long positions using margin and futures markets backed by the positive momentum from multiple spot Bitcoin ETF requests, heavy institutional inflow, and a more rational approach from U.S. lawmakers. Given the favorable scenario toward cryptocurrencies, Bitcoin bulls should now have the upper hand to sustain the $30,000 BTC price support level in the coming weeks.
Source: Cointelegraph
