- The traders’ discussion about Bitcoin was at a healthy level.
- Liquidity flowing into the futures market has been relatively modest.
For the past few weeks, Bitcoin [BTC] has been trading around $30,200 and a little below $29,000. With its price in a narrow range, it is not unusual to find BTC traders tangled between going bullish or succumbing to the bearish side.
Read Bitcoin’s [BTC] Price Prediction 2023-2024
Interestingly, Santiment’s 25 July analysis considered which flank traders are more likely to camp. In the on-chain analysis put forward by Brian Quinlivan, traders don’t seem to be worried about Bitcoin’s loss of the $30,000 psychological support level.
Bulls eyes over bears?
According to Quinlivan, this conclusion was because the social volume was based on the buy and sell sentiment. From the analysis, the number of bullish calls exceeded those appearing to call for the price top.
This means the average trader has aligned with the thought that BTC’s price, if the tight trading range exits, would trend upwards rather than downwards.
Source: Santiment
Furthermore, Bitcoin’s social dominance was 20.58%. According to Quinlivan, the metric implied that the rate of BTC discussions was at a healthy level considering that,
On a better note, the percentage of trader discussions related to Bitcoin (compared to top 100 altcoins) is still hanging on in a region that we consider to be a “healthy” area on our chart. Not by a lot, but you can see that BTC social dominance is still 2.42% above the healthy zone of discussion rate
Source: Santiment
Mild liquidity in the market
In terms of Open Interest (OI), Santiment showed that it has increased. Open Interest is the number of outstanding futures or options contracts on an exchange. When the Open Interest increases, it means that new money is coming into the market.
But when it decreases, it is a sign that the market is liquidating and more traders are closing their positions.
Source: Coinglass
In Bitcoin’s case, the Open Interest hovered around the same area for a while. This depicts that liquidity flow into the market has been oscillating between an increase and a decrease.
Concerning the funding rate, Santiment showed that the metric was still positive. For context, funding rates are periodic payments between long and short-perpetual contract positions.
Realistic or not, here’s BTC’s market cap in ETH terms
A negative funding rate means that perpetual prices are below the spot price. In this case, traders are bearish. But when the funding rate is positive, it means that traders have a bullish sentiment toward the price action.
Source: Santiment
In conclusion, the overall sentiment toward Bitcoin tilts toward indecisiveness. For now, traders are skeptical about going fully bullish or betting on a downturn.