Markets
Bitcoin Futures Suggest Another Market Correction After FOMC Meeting
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Bitcoin perpetual futures markets are currently experiencing high funding rates, signaling a premium for long positions and a further correction in spot prices, according to the “Bitfinex Alpha”. reports latest edition.
CME Bitcoin futures’ growing open interest, reaching $11.4 billion as of June 4, parallels March’s all-time highs before a notable price correction. Traders appear to be taking advantage of the basic arbitrage opportunity, shorting Bitcoin on the open market while gaining spot exposure via ETFs, aiming to profit from futures and spot market price differentials .
Despite 20 straight days of ETF inflows since May 10, potential disruption looms with upcoming U.S. Consumer Price Index report and Federal Open Committee interest rate discussions United States market which should take place this week.
Last week, Bitcoin price fluctuated, reaching above $71,500 and then correcting to a local low around $68,500. Major altcoins saw declines, with Ethereum (ETH) and Solana (SOL) falling 7.5% and 12.1%, respectively.
Recent “leverage” has led to significant liquidations of leveraged long positions in the altcoin, with Coinglass data showing Bitcoin open interest at an all-time high of $36.8 billion on June 6 .
Nonetheless, short-term holders have increased their Bitcoin activity, with holdings peaking at 3.4 million BTC in April. In contrast, long-term holders demonstrate confidence by accumulating Bitcoin, with the inactive supply for one-year holders remaining stable.
Bitcoin whales are also in an accumulation frenzy, with their balance hitting a new all-time high.
Therefore, although derivatives data suggests a short-term price pullback, factors such as increased ETF buying activity, reduced selling pressure from long-term holders and improved liquidity could potentially catalyze Bitcoin’s bullish movement in the long term.
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