The ongoing price transaction of bitcoins is pretty lucrative. But as per the analysis and expectation of different bitcoin analysts, it is being expected that different factors will influence the trajectory of the coin.
Following are the seven major factors that can derail a bitcoin bull run.
Demand and adoption metrics:
Currently, the demand for bitcoins is dependent on new buyers and stock day traders. But these metrics will be stable only if there is enough liquidity from crypto to crypto exchanges and if it matches with the expected demand. Thus, the price is dependent on demand and adoption metrics.
The decrease in relation to gold:
Gold has a pretty volatile price. Gold comes up with very high and very low price ranges. But the volatility factor of bitcoins is even much higher. But when compared, the volatility of gold can be made stable, which does not seem possible for bitcoins at present. Thus, bitcoin needs to decrease its price volatility in relation to gold.
Market capitalization and Defi:
The position of defi in the market is expected to be steady and strong. Many traders are showing interest in Defi and etherium. Thus, this can be another reason for the derailment of the bitcoin bull run.
Open positions in bitcoin:
The open positions in bitcoins are witnessing a high level. But as per few analysts, in the long run, this status can be conducive to the position of bitcoins.
The decrease in bitcoin option volume:
A high volume of bitcoin meant that there would be greater interest in bitcoins in a longer duration. In addition to this, higher volume meant higher interest rates. But a decrease in the BTC volume is another red flag that must be paid attention.
Offloading of calls:
As per a recent report, the number of bearish puts relative to bullish calls has decreased in the market, and traders are flooding the bitcoin market with their call options.
Pull back from institutional investors:
Bitcoins demand has been continuously high. But the present financial uncertainty and a decline in USD is driving the investors to pull back from making any investments.
Thus, all these reasons are the major points you should consider before making an investment in bitcoins. It is always best to move in any direction carefully if you want to get maximum benefits from bitcoin investment.
These were some proven methods to Derail A Bitcoin.