Market watchers have noticed that leveraged long positions on Bitfinex jumped more than 20% in recent days, even as the price of BTC slipped under its 100-day moving average. Analyst Omkar Godbole argues that this isn’t a show of strength but a sign of fragility.
Historically, Bitcoin rallies have tended to coincide with declining long exposure, while steep drawdowns have arrived just as traders loaded up on leveraged longs. In other words, the very trades designed to profit from upside have often marked exhaustion points instead.
This dynamic is playing out against a shaky macro backdrop. The Federal Reserve’s latest rate cut gave markets only a short-lived boost, and uncertainty around the economic outlook has left risk assets vulnerable. As of Monday, Bitcoin had dropped to $112,000 and Ethereum to $4,200, erasing optimism from earlier in the month.
For contrarian traders, the current surge in long positioning could be a warning that more downside is ahead. Rather than interpreting heavy bullish bets as confidence, history suggests they may be another reason for caution.
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