Lackluster network activity, falling Bitcoin dominance and options market data all suggest that Bitcoin’s downside price action could intensify in the short-term.
on July 13, which reduced regulatory risks for altcoins. Industry representatives believe this decision will benefit crypto exchanges Coinbase and Binance in their SEC lawsuits. The diminishing dominance of Bitcoin marks a trend shift from the gains observed between December 2022 and June 2023 when it increased from 40.2% to 52%.Bitcoin's 1-year active supply, representing the sum of unique BTC transacted in the trailing 12 months, reached its lowest level since February 2016 at 6.
The main"fear and greed" metric for Bitcoin options, the 25% delta skew, indicates that bulls are becoming less confident over time. Readings above 7% suggest traders anticipate a drop in Bitcoin's price, while periods of excitement typically yield a -7% skew.Currently, the 30-day metric remains flat at 1%, indicating a balanced demand between call options and protective puts, signaling a neutral market.
As investors' mood worsens and indicators point to increased tension, Bitcoin price faces mounting pressure in the near term. Falling dominance, lackluster network activity and concerns in the options markets all contribute to the potential negative impact on Bitcoin price. On a positive note, if traders remain cautious and anticipate further downward movement, the likelihood of excessive liquidations among leverage traders is reduced.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
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