Bitcoin stalls near record highs amid derivative pressures but breakout potential remains

Bitcoin (BTC) continues to grounds on-chain spot contempt a prolonged play of terms compression betwixt $100,000 and $105,000. 

According to Fidelity Digital Assets’ VP of research, Chris Kuiper, the flagship crypto remains successful its “Acceleration Phase,” a play characterized by elevated wallet profitability and volatility, adjacent arsenic derivatives enactment dampens upward momentum.

Bitcoin closed astatine $104,119 connected May 13, with 99% of addresses successful profit. Fidelity information shows that 10 days successful May person qualified arsenic high-profit, high-volatility sessions. Historically, this signifier has aligned with breakout movements, including the surge that followed the US predetermination successful precocious 2020. 

Despite these conditions, Bitcoin has been incapable to decisively breach its precocious absorption levels, with closing prices mostly contained wrong a constrictive $94,000 to $104,000 set passim the archetypal fractional of May.

Derivatives enactment creating headwinds

According to a May 16 report by CryptoQuant contributor Darkfost, the restrained terms enactment stems from structural pressures successful the derivatives market.

The study highlighted that cumulative nett taker volume, a measurement of assertive trading flow, has remained antagonistic since Bitcoin reclaimed the $100,000 level. This imbalance shows that abbreviated positions person outweighed longs, generating sustained selling pressure. 

The bearish positioning indicates that traders are skeptical of a near-term determination to caller all-time highs and are actively betting against further upside. As agelong arsenic this imbalance persists, Bitcoin’s upward imaginable remains capped contempt favorable conditions successful spot and on-chain markets.

Price stagnation successful the beingness of bullish fundamentals is not unprecedented. However, adjacent beardown web signals tin beryllium muted temporarily erstwhile derivative flows overpower spot accumulation. 

The existent divergence betwixt derivatives enactment and on-chain profitability highlights the friction successful Bitcoin’s terms find process.

Bitcoin volatility hits grounds debased vs. gold

Bitcoin’s muted terms question has besides resulted successful a historical compression of volatility, which has deed levels past seen much than 10 years ago.

VanEck’s caput of integer assets research, Matthew Sigel, noted connected May 16 that Bitcoin’s 30-day volatility has dropped beneath gold’s for the archetypal clip since information tracking began. 

Based connected Bloomberg terminal metrics, the BBR/GC1 ratio is present astatine 0.857, its lowest level implicit a decade.

While derivatives positioning remains a near-term barrier, humanities patterns suggest that prolonged periods of volatility suppression person often preceded ample directional moves. 

Whether that materializes again depends connected shifts successful taker flow, macro conditions, and liquidity conditions.

The station Bitcoin stalls adjacent grounds highs amid derivative pressures but breakout imaginable remains appeared archetypal connected CryptoSlate.