Trading Desk Insights
Bitcoin moved higher toward the $71,000 region today as the recent recovery from February’s lows continued to gain traction, but several derivatives and onchain indicators suggest that conviction behind the move remains limited. Despite a roughly 22% rebound from the $60,000 local bottom reached earlier in February, a large portion of the market is still underwater. Glassnode data indicates that about 43% of the circulating Bitcoin supply is currently held at a loss based on the last time those coins moved onchain, up significantly from around 30% when Bitcoin was trading close to $90,000 earlier this year. This creates a potential overhang of supply as investors who bought near the highs may look to exit positions as price approaches their cost basis.
Derivatives markets reflect a similar tone of caution. Bitcoin options on Deribit show put options trading at roughly a 10% premium compared to equivalent call options, signaling stronger demand for downside protection than for bullish positioning. Under neutral market conditions, options skew typically fluctuates between negative 6% and positive 6%, meaning the current structure indicates that professional traders are still hedging against further downside even as prices rise. Futures markets also remain relatively subdued, with the annualized basis rate still below the neutral 5% level, suggesting that leveraged long exposure has not meaningfully expanded.
Pressure from the mining sector is also beginning to enter the conversation. Rapid growth in artificial intelligence infrastructure has driven energy demand significantly higher, squeezing margins for Bitcoin miners. The Hashprice index, which measures the expected daily revenue from one terahash per second of hashing power, has fallen to roughly $30 per day from about $39 three months ago. As profitability compresses, several publicly listed mining firms have begun selling portions of their Bitcoin reserves while redirecting computing capacity toward high performance computing and AI related workloads.
From a market structure perspective, traders are closely watching the $76,000 level, which represents the approximate average acquisition price for major corporate Bitcoin holders such as Strategy. With the company having accumulated more than 720,000 BTC since 2020, this level has become an important psychological reference point for the broader market. A sustained move above that threshold could strengthen bullish momentum and potentially open a path toward the $78,700 region, which corresponds to January’s monthly close. Until that resistance band is reclaimed, however, Bitcoin’s rally may continue to face friction from cautious derivatives positioning and lingering supply from holders still sitting at a loss.
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This research is for informational use only. This is not investment advice. Other than disclosures relating to Secure Digital Markets this research is based on current public information that we consider reliable, but we do not represent it is accurate or complete, and it should not be relied on as such. The information, opinions, estimates, and forecasts contained herein are as of the date hereof and are subject to change without prior notification. We seek to update our research as appropriate.
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