Price analysis suggests start of new trend in Cryptocurrencies.

The action in altcoins has become coin specific, meaning, traders should remain with those that are in an uptrend as they are likely to follow Bitcoin if it moves higher.

A month after the first halving, Bitcoin (BTC) moved up by 7% but following the second halving, the price slipped by 10% in a month. This suggests that if history were to repeat itself, the top-ranked cryptocurrency on CoinMarketCap will remain volatile but a large move in either direction is unlikely in the first month. However, the derivatives markets could be giving a signal that this time is different.

This week CME Bitcoin options open interest increased to about $142 million, an increase of over 1000% since the end of April, according to data from Skew. This shows that the options traders are expecting a sharp move in price within the next few days. 

There are approximately $661.7 million worth of long positions open, compared to $252 million in short positions, on the three major futures exchanges. This suggests that the futures traders are holding on to their long positions as they are confident that Bitcoin could soon break above the psychological barrier of $10,000.

Murmurs of negative interest rates have also increased in the U.S. and a report by Stack Funds suggests that if negative rates become a reality, institutional investors would be forced to look for alternative assets to generate higher returns. 

With Bitcoin outperforming the U.S. stock markets by a wide margin and doubling gold’s gains year-to-date, institutional interest is likely to rise.

The fundamentals of Bitcoin continue to paint a bullish picture and the derivatives traders are also expecting a trend defining move to start soon. 

Let’s study the charts to spot the critical levels that could indicate the start of a new trend in major cryptocurrencies.