Upside Calling? Bearish Bets on Bitcoin Futures Hit Record Low

The bearish sentiment in the bitcoin futures market hit a record low last week, likely indicating the worst of the plunge in the leading cryptocurrency is behind us.

The non-commercial futures contracts of bitcoin futures, traded by large speculators and hedge funds, totaled a net position of -1266 contracts in the week ended Aug. 21 - the lowest on record, according to the data released by the Commodity Futures Trading Commission on Friday.

The futures data indicates the speculators are the least bearish on BTC since the futures listing back in December.

A negative total represents net short positions and a positive tally indicates net long positions.

The sharp drop in the bearish sentiment, as represented by the steady decline in the net short positions from the high of -1945 seen ten weeks ago to -1266, adds credence to the signs of bearish exhaustion indicated by BTC's defense of $6,000 since mid-June.

At press time, BTC is changing hands at $$6,715 on Bitfinex.

As seen in the above chart, BTC printed lows below $6,000 three times in the last ten weeks, but the drop was short-lived, that is, all three weekly candles closed above the psychological mark.

The upward sloping 5-day and 10-day moving averages indicate a short-term bullish setup.

View The bearish net positions in the bitcoin futures markets hit a record low last week, validating the argument put forward by the technical charts that the cryptocurrency has likely bottomed out around $6,000.

A move below the ascending trendline seen in the 4-hour chart would weaken the bullish case and could yield a drop to $6,230.