According to crypto analyst Arman Shirinyan, the 13% correction of Bitcoin (BTC) went unnoticed by traders, and many began to open short positions that allowed them to profit from an asset that had lost its value. According to the indicator provided by the CEO of CryptoQuant, after Bitcoin faced a market pullback, the derivatives market faced increased short volume. The analyst states that the main reason for this is mostly due to the changing sentiment in the market.
Bitcoin (BTC) correction and market sentiment
Senior market analyst Oanda Craig Erlam says that the Bitcoin correction is an expected event that should happen sooner or later, especially after the cryptocurrency has rallied around 66% in the last few months and even more since the beginning of the year.
Most analysts agree that Bitcoin has no choice but to enter the distribution phase of a cycle and slow down a bit. Arman Shirinyan states that compared to the size of the rally the market has experienced in recent months, a breakout of up to $50,000 is possible, but not so significant.
Analyst Arman Shirinyan points out that after the volatility in the market increased, sentiment indicators such as the fear and greed index approached the “fear” and “extreme fear” values, which indicate that the market reaction is much larger than the actual price action.
cryptocoin.com As you can follow from our news, a minor correction in the market that started in May resulted in a 50% pullback to $28,000, due to a strong change in sentiment fueled by the over-leveraged market and the industry collapse that started in China.
At press time, Bitcoin is trading at $57,900 with a slight recovery from the $55,000 area. The analyst states that although the cryptocurrency managed to recover around 5%, the market remains bearish with losses of more than 7% this week.
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