The recent surge in Bitcoin prices is raising eyebrows among traders and analysts alike. What is particularly interesting is the role that the spot market is playing in driving this upward momentum. Spot Cumulative Volume Delta (CVD) has been on the rise, indicating a significant increase in net buying activity on the spot market. This surge in spot buying volume is directly influencing the price of Bitcoin, pushing it higher as more investors jump in to buy.
While the spot market is showing signs of bullishness, the futures market is painting a slightly different picture. Perpetual contracts are reflecting a decline in buying activity, with the Perp CVD dropping alongside a rise in selling pressure. This divergence between the spot and futures markets is a cause for concern, as it could indicate a potential disconnect between the two markets. Traders in the futures market may be more bearish, leading to increased selling and downward price pressure.
The growing open interest on the shorts’ side is a potential red flag for Bitcoin bears. Historically, such divergences between spot buying volume and futures market activity have often resulted in short squeezes. If this trend continues, we could see a breakout in Bitcoin prices, with the potential for a move towards $100,000 becoming more likely. The growing spot buy delta and declining Perp CVD are key indicators to watch closely in the coming days.
For spot traders, the current market dynamics may present a buying opportunity. The surging spot buying volume suggests a strong level of buying interest, which could fuel further price increases. On the other hand, futures traders may need to exercise caution, given the bearish sentiment in the Perp CVD and the increasing selling pressure in the futures market. This divergence between the two markets highlights the importance of closely monitoring both spot and futures market activity to make informed trading decisions.