The Bitcoin derivatives market is flashing alarming signals of high leverage levels, which could lead to drastic price changes.
Warning Signals from the Market
Analyst Axel Adler Jr. reports that the 30-day change in the Estimated Leverage Ratio (ELR) exceeded +0.4 for the first time since 2020. This level has historically preceded periods of volatility and sudden liquidations. Adler notes: "This indicates a rapid and large-scale influx of leveraged positions in futures while the price remains near historical highs."
Current Price Situation of Bitcoin
Bitcoin started the week on a strong foot, briefly reaching $122,000 on August 11 before retreating below $118,500. Currently, BTC is trading at $119,169, up 0.4% in the last 24 hours and 4.4% over the past week. Remember that the previous all-time high was set on July 14, above $123,000.
Altcoin Market Trends
While Bitcoin's price has held relatively steady, its market dominance is currently at 57.5%, slightly up after dropping to 55%. Analysts suggest that the decline in Bitcoin's share might signal the onset of an altcoin season. Current market sentiment is mixed, with CoinMarketCap's altseason index at 37 out of 100, while the Blockchain Center's gauge shows a more aggressive 53.
The situation in the Bitcoin market remains complex; the combination of high leverage, technical compression, and shifting capital flows to altcoins could lead to various scenarios in the coming days.
