Standard Contract Positions for Bitcoin Fall, and the Market Finds a New Stable

The most recent weekly data on CFTC CME Bitcoin holdings (September 27–October 3) indicates, according to Foresight News, that the total amount of Bitcoin standard contracts held has decreased from 14,844 to 14,447. This is a new low for the last 16 statistical cycles and the second week in a row of decline. The market has entered a new steady phase, but the difference from the previous statistical cycle is not considerable. This week's report's main focus is on whether the market changed during the most recent statistical cycle, given that different account types were bearish over the preceding cycle.

Long positions in the largest dealer accounts fell from 433 to 427, while short positions sharply rose from 1,859 to 2,898, setting a new high for the previous six weeks. During the most recent statistical cycle, these accounts have obviously made net short modifications, indicating a very negative view of the market. During the most recent data cycle, asset management institutions clearly demonstrated a net long operation as they expanded their long positions from 7,168 to 7,336 and decreased their short positions from 1,093 to 623. This is in contrast to the prior cycle's net short correction plan.

During the most recent data cycle, leveraged funds grew their long positions from 1,594 to 2,373 and their short positions from 8,220 to 8,565. This indicates a simultaneous increase in both directions. It is noteworthy, though, that following this round of revisions, the percentage of long holdings has risen sharply and has been at a record high for the last eight weeks. Big accounts broke the pattern of no change for the previous two weeks and immediately reached a 12-week high by increasing their long positions from 1,852 to 1,941 and their short positions from 114 to 410. While the percentage of long positions in large accounts is still quite high, the most recent statistical cycle's overall adjustment is bearish, maintaining the previous cycle's adjustment approach.

The aggregate amount of micro-contracts for Bitcoin dropped from 8,690 to 6,193. Dealer accounts showed a net long adjustment in micro-contracts, a traditional risk hedging activity, as they increased their long positions from 338 to 368 and decreased their short positions from 435 to 146. Asset management firms boosted their short positions from 806 to 1,120 and decreased their long positions from 319 to 273, showing a net short adjustment in micro-contracts. When combined with conventional contract modifications, this is also an act of risk hedging.