Bitcoin (BTC) experienced instant volatility on March 11 amid hopes that the conflict between Russia and Ukraine could find a diplomatic solution.
Hope rises, but so do Bitfinex’s short positions
Data from Cointelegraph Markets Pro and TradingView showed that BTC/USD briefly rose $1,400 before pulling back and consolidating below $40,000 on Friday.
The move higher came after further comments from Russian President Vladimir Putin, who in a meeting with his Belarusian counterpart Aleksandr Lukashenko said there had been “positive changes” in Ukraine’s dynamics.
“There are some positive changes, negotiators on our side tell me,” he said, quoted by Reuters and others.
Bitcoin, already known for not “liking” escalations in armed conflict, immediately rallied in line with European and US markets. Germany’s DAX rebounded 2.6% on the news, while S&P 500 futures were up 1.1% before the open on Wall Street.
At press time, the BTC/USD pair was still volatile, with the bulls attempting to break the $40,000 resistance more convincingly.
However, the warnings above came from those who were watching the rapid rise of short positions on Bitfinex, a classic sign that short-term decline should be imminent.
explosive growth in #bitcoin bitfinex shorts
hate to say it, capitulation incoming pic.twitter.com/FTQGt41UBQ
— Cole Garner (@ColeGarnerXBT) March 11, 2022
These were still rising at the time of writing, visible on both the daily and shorter timeframes, and reaching their highest levels since July 2021.
The push to local highs of $40,200 prompted moderate liquidation of short positions on derivatives platforms, as data from the monitoring resource, Coinglass, showed.
Traders keep calm
Bitcoin still hasn’t reached the top of its established trading range, and the zone beyond $42,000 has proven impossible to hold for long through 2022.
However, recent price action was a boon to some traders, with the popular Twitter account “Anbessa” telling its followers that everything was going according to plan.
$BTC/USD Update ✅
bullish divergence playing out ✔ï¸
4th entry -> 4 bounce up 3% pic.twitter.com/QqZnheFLyQ— ANâ‚¿ESSA (@Anbessa100) March 11, 2022
For his part, the trader Pierre highlighted an ascending support wedge that the bulls should hold going forward.
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