Bitcoin CME Data Shows Massive Bears Are Waiting BITCOIN FUTURES (CONTINUOUS: CURRENT CONTRACT IN FRONT) CME:BTC1! TheAlphaTrades Bitcoin CME Futures Data Shows Hedge Funds and Institutions are Increasing Shorts The bears are in hiding, retail traders watch your step! Some of this write-up may have missing links, which needed to be removed to abide by TradingView House Rules ;) Happy Wednesday! The community is growing, and I hope you guys are a part of it because I think we’re going to find some tremendous opportunities in these volatile markets over the next several months. This is also an election year, so our team expects volatility will be especially interesting in the United States and that will ripple into global markets, particularly Forex. Let's dive into today's late morning Bitcoin analysis. Something’s coming in Bitcoin… I’m currently short BTC and still believe there’s a strong chance it’ll spike down. There’s a couple of reasons I think that, which are also explained in today’s video (please do your own research, this is not financial advice). Bitcoin has found itself in a wide price range for about six days, consolidating between 9970 to 9100. That’s a nearly $800 range as trader sentiment struggles with whether or not this asset has the strength to rise above the tide that is the S&P 500 . The price has also printed higher lows as bulls continue to guide the price upward for what could be a breakout of an ascending triangle . However, I believe this may be deceit on part of the bears, as I believe BTC is more bearish than bullish up there. Hopefully, readers will catch this analysis before anything drastic happens in the market. The first clue that bears may step in soon is that volume has tapered off as the price challenges the trend line as seen in the image below, and second I want to point out that so far, BTC has pulled back into the range on every occasion of deviating from it, and on the back of a spike in volume . I think we are due for yet another volume spike which will pull price at least back into the range. We are two and a half weeks into this extended distribution in and out of the channel, and from a higher time frame, a lot of sell-side volume stepped up with the buyers unable to put in higher highs. This tells us the bulls are struggling to break through to a real higher high. For a deeper understanding of what’s going on, I look at the order book data and order flow, which to me reveals the bears are guiding the price up, enticing retail traders to buy in at ever-higher prices, and possibly preparing to pull the rug on bulls. Larger players sometimes bid the price of an asset into their own order walls in order to distribute at a more cost-efficient price according to their own playbook. Waiting for more information before measuring a Bitcoin breakout Let’s say there is a breakout to 10,100 or 10,500 at best, then we can erase all the confusion and assume 11,000 and maybe 11,500 is the next target, but that price action has yet to be proven. I described a lot of what you’re reading here in my Bitcoin Roadmap to 2025 video, in which I also map out the Elliott Wave counts for the next few years, daily volume-to-price divergence, as well as some forensic analysis of how more miners are selling now than after any previous halving event. From a daily perspective, there is defined risk at the key high of 10,500 from October 2019 and February 2020, while sellers have clearly been holding the 10,000 area strong for several days now. This is why I have held my swing short position for so long, as I am carefully watching whether price can break through and hold above 10,000 to challenge those stronger resistance levels. Deep dive into CME data Bitcoin CME futures data is very useful in understanding market structure as well as futures positioning or open interest of larger hedge funds. The bottom indicator in the image below monitors CME COT data, which is the Commitment of Traders report, and provides insight on the market positioning of a number of players. The first thing to note is open interest has spiked up really hot, and yet the price has declined against that. So what does that tell us? I’ll refer readers to this guide from Sword and Shield, which explains COT data from the perspective of forex markets. The same principles apply to Bitcoin as well. Now that you have a stronger understanding of the data, you may conclude that as price decreases while open interest increases, the market remains relatively bearish despite that sentiment being hidden on a naked chart. The black line on the COT indicator represents “non-reportable” which may reveal high net worth individuals, the green line is for “non-commercial” which are larger institutions and hedge funds, and the red line stands for “commercial” or people with hedged positions in the market (they attempt to stay relatively neutral with price action). Non-commercials matter a great deal for price action, as these are larger institutions and hedge funds, and when they nudge, the market moves. From this chart, we can assume larger players in the market are net-short and short positions are growing in line with price rising, while simultaneously it appears that retail traders continue to stack long positions. This tells me that while there’s a high chance of a massive fake-out breakout, ultimately larger players in the market are wearing their bear suits and prepared to cash in on retail traders buying into their trap. The last indicator we’ll check out in today’s analysis is Order Book Volume (OBV), which helps you understand the inflows and outflows in the market. From a one-hour timeframe, the OBV again reveals that as the price continues to climb, it is not being followed by an increase in order book flow, so many people are sitting on their hands at this stage. Disclaimer Information provided by Alpha Trades, LLC is not intended to be utilized in making any financial decisions and is not a solicitation, nor recommendation to buy, hold, and/or sell a particular product, digital asset, or ICO .