Yesterday's stabilization of bitcoin and a possible breakout from the downtrend channel, yet being moderate, led to the drop of the number of shorts. It feels like the big players want more shorts to collect before gather them by boosting the price. It would be a perfect explanation for the fact that the recent drop in price made an increase of the number of shorts to a level even higher than it was before and approached to a hot zone, which was at the very bottom of bitcoin price at ~6k. Moreover, for the same reason, the number of longs dropped significantly. Both facts indicate to the market condition approaching to the reversal. The question is only, whether it would be one more drop before that in order to sharpen the situation even more. The swings may continue until the end of September though, when the SEC will announce the decision for ETFs.
At the same time, I must say that since the increase of shorts wasn't as huge as it was during the previous drop, there is not so much left around this price, unless to goes really low. So, again, it is more likely that there will be a correction upwards.
At the same time, I must say that since the increase of shorts wasn't as huge as it was during the previous drop, there is not so much left around this price, unless to goes really low. So, again, it is more likely that there will be a correction upwards.