Darkfost
Futures volumes are collapsing on BTC while sellers remain in control
Bitcoin futures trading continues to drive the market, even though daily volume has been cut in half since November 22. ➡️ Volumes have fallen from $123B to $63B, which partly explains the low volatility observed on BTC in recent weeks. That said, with $63B in daily volume, futures trading still represents nearly 20 times the volume of spot Bitcoin ETFs ($3.4B) and about 10 times spot market volumes ($6B). Many continue to point to ETFs, which have experienced significant outflows in recent weeks. While these outflows do contribute to selling pressure, futures markets clearly remain the dominant force in overall volumes. ➡️ When analyzing net taker volume, which provides insight into buying and selling activity on derivatives markets, we can clearly see the impact that futures volumes have on price action. Each time net taker volume has turned negative, Bitcoin has entered a corrective phase. When this indicator moves into negative territory, selling volume dominates. The faster the trend accelerates, the stronger the selling pressure coming from futures markets becomes. Since July, net taker volume has generally remained negative📉 A noticeable slowdown occurred in early October, allowing Bitcoin to set a new all time high, but selling pressure quickly regained control. 👉Today, selling volumes continue to dominate and have kept Bitcoin trapped in a range for about a month. There is, however, one encouraging sign. Selling pressure from futures has declined significantly since early November, with net taker volume improving from around -$489M to -$93M. While this reduction in futures driven selling pressure is a positive signal, it is not yet sufficient. Liquidity remains weak, and both ETF and spot market volumes are still too limited to allow BTC to break out of its current consolidation phase. This is something that will need to be closely monitored.