The pessimistic sentiment around bitcoin prices saw the number of shorts hit a six-week high on Thursday.

At press time, BTC/USD short positions on the cryptocurrency exchange Bitfinex jumped to 37,891 – the highest level since Oct. 15 – and were last seen at 36,996. Notably, shorts have risen by 95 percent in the last three weeks, accompanying BTC’s recent drop to 14-month lows near $3,500.

More importantly, the short positions remained elevated above 35,000 during BTC’s oversold bounce from $3,500 to $4,400 and climbed to fresh multi-week highs on Thursday. Further, the long-short ratio of 0.73 is biased toward the bears.

BTC/USD shorts on Bitfinex

The data indicates that, despite being so deep into the bear market, sellers appear to be showing no signs of exhaustion. As a result, the cryptocurrency may revisit the recent low of $3,474 as hinted in the technical charts.

The bearish sentiment, however, could soon reach extremes as the short positions are down just 7 percent from the record high of 40,289 that was reached on on Sept. 19. Moreover, the extreme bearish positioning is widely considered a sign that the sell-off is overdone and often presages a trend reversal.

Therefore, the prospects of sudden bullish reversal, similar to the one seen on April 12, would improve substantially once the short positions reach record highs.

Disclosure: The author holds no cryptocurrency assets at the time of writing.

Market app image via Shutterstock; Price charts by Trading View