The price of bitcoin fell to $18,270, but traders in futures didn’t panic. Why? Read on. In the early hours of September 19, Bitcoin (BTC) had a 9% correction as its price fell to $18,270. The price was at its lowest point in three months even though it rapidly rose back above $19,000. However, as evidenced by futures contracts, experienced traders resisted the urge to accept the loss.
It is very difficult to pinpoint the cause of the disaster, however some claim that US President Joe Biden’s appearance on CBS “60 Minutes” highlighted issues of world conflict. If a China-led invasion occurred, would American military protect Taiwan? “Yes, if there was an unprecedented onslaught,” Biden responded when asked.
Others point to the Chinese central bank’s reduction of 2.25% to 2.15% of the borrowing cost for 14-day reverse repurchase agreements. By adding to the amount of money being injected to support the economy under inflationary pressure, the monetary authority is displaying signals of weakness in the present market environment.
Long The Bitcoin Bottom Or To Watch And Wait: Bitcoin Traders And There Dilemma In This Bearish Market:
Additionally, there is pressure from the impending Federal Reserve Committee meeting in the United States on September 21, which is anticipated to raise interest rates by 0.75% in an effort to reduce inflationary pressure. The 5-year Treasury note rates thus increased to 3.70%, the highest level since November 2007.
To determine if professional investors altered their position as Bitcoin fell below $19,000, let’s examine the data on crypto derivatives.
Due to their price premium above spot markets, quarterly futures are typically avoided by retail traders. However, professional traders favour them because they eliminate the funding rate volatility that frequently occurs in perpetual futures contracts.