Bitfinex BTC Whales Reduce Long Positions: Are They Turning Bearish?

Between April 17 and April 19, Bitfinex traders reduced leveraged long Bitcoin positions by $106 million amidst a price rise above $86,000, suggesting potential concerns about a correction. Despite this, whales still hold significant long positions, indicating they may not be bearish. Historical patterns show that changes in leverage do not always align with price movements, reinforcing a more complex market sentiment.

Between April 17 and April 19, traders on Bitfinex decreased their leveraged long Bitcoin (BTC) positions by over $106 million, raising concerns about a potential correction in the market. Despite Bitcoin reaching above $86,000 recently, this activity suggests that some traders may be uncertain about short-term gains or expect a price pullback.

Following a price surge above $86,000 on April 21, prompted by US President Donald Trump’s comments on monetary policy, investors are becoming increasingly cautious due to recession fears amid global trade tensions, especially between the US and China. This context suggests that profit-taking could reflect waning confidence in Bitcoin’s sustained growth above previous resistance levels.

Between April 10 and April 17, Bitcoin margin longs on Bitfinex remained steady at approximately 80,400 BTC, indicating a robust bullish outlook. However, they subsequently reduced their positions by 1,250 BTC, reflecting a shift in sentiment even as the BTC price climbed back to $83,000. Large traders typically drive swift market movements,

Yet, it’s important to note that Bitfinex whales have not fully shifted to a bearish outlook; margin longs still total 79,136 BTC, worth approximately $6.86 billion, while shorts are significantly lower at 326 BTC. The notable disparity between longs and shorts results from a low annual interest rate on margin positions, making this trading strategy more attractive compared to higher futures premiums.

Interestingly, shifts in leverage on Bitfinex do not always correlate with Bitcoin price movement. For instance, a past increase in margin longs coincided with a price decline, and vice versa. This indicates that sophisticated investors possess a nuanced understanding of market dynamics, often maintaining their positions longer despite immediate price fluctuations.

Consequently, while the $106 million reduction in Bitcoin margin longs signals some level of caution, it does not firmly imply a bearish trend among professional traders. Onchain data indicates that Bitcoin whales have actually grown in number despite price declines, pointing towards an ongoing trend of accumulation rather than panic selling.