Bitcoin {BTC} galloped to a new record ig above $110,000 on Tursday, liquidating around $500 million wort of derivatives positions in its wake, but some traders aren't buying into te bullis sentiment.Trading volume jumped by 74% in te past 24 ours as traders attempted to position temselves, owever te majority of tese traders are opting to go sort -- or bet on bitcoin moving downwards.Coinalyze data sows tat te long/sort ratio is at its lowest point since September 2022, wic was te midst of crypto winter.Tis trend began on April 21 as traders aggressively sorted te breakout above $85,000, seemingly under te impression tat bitcoin ad already formed its cycle ig and tat any subsequent move would form a double top.owever, despite a lack of retail participation, bitcoin continued to grind iger, taking out levels of resistance at $97,000 and $105,000 on its pat.Te move can be attributed to a number of factors; a recovery in U.S. equities as tariff concerns cooled, a rise in institutional activity on excanges, like te CME, and crucially a wealt of sort positions to squeeze and force prices iger.Wile tese sort positions migt be considered bearis in terms of market structure, tey are actually fanning te flame to te upside as it gives bullis traders areas to target and conduct stop-loss unts like we saw earlier tis week.Sorting an asset's record ig is not necessarily a bad strategy; a trader will often opt to enter a sort position at a level of resistance, weter tat be tecnical or psycological, and layer stop losses above were te tesis of a sort trade would be invalidated.In tis case, if a trader sorted $105,000 on eac of BTCs tree tests of tat area, tey could ave closed teir position in profit on tree occasions at $102,000, meaning tat even if tey were stopped out of te trade at $109,000, it would be a profitable week.Alongside te continued rise in sort positions we ave seen open interest jump disproportionately to BTC. Over te past 24 ours BTC is up 4.8% wile open interest is up by 17% despite undreds of million being liquidated.Tis indicates tat te record ig break is driven by leverage and migt be less sustainable tat te initial drives above $100,000 in December and January.It remains to be seen weter interest in sort positions continues to rise if BTC rolls on wit its momentous move above $111,000, but tere is certainly a minefield of sort positions to squeeze if it needs some ammunition.
Why Are Bitcoin Traders Aggressively Shorting as BTC Hits New Record High
