Following a week of instability in the cryptocurrency markets, Bitcoin has continued to drop, albeit slightly, and traders are increasingly losing confidence that the markets will experience any type of relief rally or end-of-year rally in the coming weeks.

At the time of writing, Bitcoin (BTC) is trading down 1.5% at its current price of $3,430. Bitcoin appears to have established the $3,400 region as a level of support, although this will only be validated if BTC is able to hold this level as support over the coming days, and bounce if it is touched again.

Recent data regarding the ratio of net-long to net-short positions shows that traders are increasingly becoming pessimistic about BTC in the near-term, as net-short positions have climbed significantly over the past week.

According to data from DailyFX, the majority of traders are still net-long on Bitcoin, but short positions have climbed by over 21% from where they were just one week ago.

“Retail trader data shows 70.1% of traders are net-long with the ratio of traders long to short at 2.35 to 1. The percentage of traders net-long is now its lowest since Nov. 28 when bitcoin traded near $4,200.66. The number of traders net-long is 1.6% lower than yesterday and 2.7% lower from last week, while the number of traders net-short is 14.0% higher than yesterday and 21.4% higher from last week.”

Although statistics regarding short and long positions gives a good indication of the sentiment amongst traders, it is not a reliable indication of which direction a specific asset will trade in the near, mid, or long-term, and some investors actually view it as a counter indicator.

Altcoins Experience Mixed Trading Session

Bitcoin’s current instability has led to a mixed trading session for altcoins.

XRP is currently one of today’s best performing cryptocurrencies and is currently trading down marginally at its current price of $0.30. So far, XRP has respected the $0.30 region as a level of support, and only briefly fell below this price yesterday.

At the time of writing, Ethereum (ETH) is trading down 1.6% at its current price of $89.8 and has been unable to stabilize above $90. Ethereum appears to have established $88 as a potential support level, although only time will tell whether or not it is able to hold, and bounce, at this level.

Bitcoin SV (BSV) is one of today’s worst performing altcoins and is currently trading down over 5% at its current price of $90.5. Last week, BSV briefly passed Bitcoin Cash (BCH) by market capitalization when it rose to $114, but in the time since has declined by over 20% and is now behind BCH’s market cap by over $200 million.

All the cryptocurrencies mentioned in this article are available to trade on covesting.io