The post Bitcoin Leverage Balance Teases High Volatility, What To Expect From BTC Price? appeared on BitcoinEthereumNews.com.

The Bitcoin leverage balance across all exchanges teased intense volatility with traces of upward and downward movements. BTC price as of now hasn’t seen higher highs. XBTManager, a community on-chain analyst at CryptoQuant, shared insight into the Bitcoin market using the Estimated Leveraged Ratio (ELR). The analyst explained that retail investors have increased risks in the derivative markets. Consequently, investors are now watching to see the impact on Bitcoin’s future price trajectory. Bitcoin Leverage Balance, the Insight The Estimated Leverage Ratio measures the proportion of open interest divided by exchange reserves. This metric is important for measuring the market’s inclination toward risky positions, providing vital insights into market sentiment. According to XBTManager, the relationship between Bitcoin (BTC) price and leverage ratio is critical for understanding market dynamics. – Advertisement – Bitcoin’s Leverage Balance: Traces of Upswings and Downturns “As market makers push Bitcoin’s price higher, retail investors begin to take excessive risks in derivative markets.” – By XBTManager Read more 👇https://t.co/1dFIE0UGtO pic.twitter.com/9pDTcOmOoc — CryptoQuant.com (@cryptoquant_com) January 29, 2025 The analyst shared a chart that showed a fluctuating Bitcoin leverage balance in the last 30 days. XBTManager pointed out that the leverage ratio rose rapidly during the 2021 bull market cycle. This suggested that market participants were confident in the price increase and took on additional risk. The analyst, however, noted that a rising leverage ratio could spark huge liquidations during price declines, causing prices to decline. This scenario occurred during the 2022 bear market, a period during which investors reduced their risks, and the market transitioned to a more cautious phase. Retail investors have started taking excessive risks in derivative markets as market makers push Bitcoin’s price higher. The current dynamics reflect a transition into periods of heightened market enthusiasm. Usually, confidence in the market grows during the excitement phases…

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Filed under: News - @ January 31, 2025 3:26 am