Bitcoin (BTC): Will September ‘Bull Trap’ History Repeat?

Bitcoin (BTC): Will September ‘Bull Trap’ History Repeat?

September 2, 2022 0 By Gabriel Rollins

Bitcoin price has welcomed September at crossways. Lateral actions within the past six days saw investors wondering who would win the battle -bears or bulls? The present low volatility could be temporary. Let us find out more.

According to a pseudonymous CryptoQuant expert, elcryptotavo, Bitcoin (BTC) is about to witness a volatility flood. He revealed fascinating trends within the derivatives sector. They include an uptick in derivative reserves plus a dip in open interest.

A surge in derivative reserves usually signals that wallets within the derivatives market are increasing their holdings. Moreover, investors consider open interest decline a signal that the present trend is losing momentum. In that context, BTC confirmed a bearish action since mid-August.

BTC funding rates & transaction fees metrics also registered an activity surge within the past four months. That showing buying momentum within the derivatives marketplaces is soaring. That could be a lucrative opportunity for traders within the derivatives space to join the craze and capitalize.

Teasing Bulls

Volatility and demand surges within the derivatives marketplace will potentially impact spot market demand. A bullish demand wave could lead to a substantial near-term upside. BTC’s supply distribution index on Santiment shows buying momentum has already begun soaring.

Bitcoin addresses with over 10K tokens have accumulated since August 28. Nevertheless, wallets holding 100 – 10K BTC reduced their holdings within the previous five days. Therefore, restricting any possible upside.

Possible Unpredicted Risk?

Bitcoin could have started this week with some uncertainty, but the present observations emphasize an optimistic sentiment. The change to impressive funding rates & surged volumes within the derivatives market means a lucrative indicator backing the probable upside.

Nevertheless, investors should remain cautious as we welcome the new months. September has been a bearish month for the crypto space. History repeating itself will mean heading into a bull trap. While publishing this blog, BTC maintained minor price actions around the $20K level.

Bears have dominated the crypto spectrum within the past few sessions, painting red in weekly and 24hr timeframes. It’s unclear what September has for the market, but time will tell.

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