On May 26, following Trump's postponement of 50% of EU import tariffs, Bitcoin investor sentiment improved.
European stock markets reacted positively to this development, but Bitcoin failed to hold the $110,000 level, leaving traders skeptical about whether this flagship asset can continue to set new all-time highs.
Even if Bitcoin falls back to $105,000, the growing institutional interest and strong derivatives market indicate that traders are not over-leveraged or overly concerned about potential pullbacks.
Demand for leveraged Bitcoin long positions has increased, evidenced by the BTC futures premium reaching 8% on May 26. While this is only a slight increase from the previous day's level of 6.5%, the indicator remains within the neutral range of 5% to 10%.
In December 2024, as BTC first broke through $100,000, the Bitcoin futures premium surged to 20%.
Will Nvidia's earnings report and U.S. economic data boost Bitcoin prices?
Trump postponed the EU import tariffs until July 9, alleviating some market uncertainty, but the economic impact of the ongoing tariff conflict has yet to fully materialize.
Investor risk appetite now partly depends on Nvidia's (NVDA) earnings report on May 28, which may explain why Bitcoin has failed to surpass previous highs.
The Bitcoin options market suggests a higher probability of price increases, indicating that even though BTC is trading 2.6% below its historical high of $111,957, whales and market makers remain confident.
The 6% delta deviation of Bitcoin options indicates that put options are trading at a discount, which is a typical feature of a bull market. Readings close to zero reflect a balance of demand between call and put options, a trend observed on May 25.
The increasing demand for BTC from institutional investors is gradually changing the risk perception of the world's largest investment firms.
Michael Saylor's strategy company purchased $427 million worth of Bitcoin between May 19 and May 25, at an average price of $106,237. Meanwhile, the spot Bitcoin ETF saw inflows of $2.75 billion during the same period.
On May 19, during JPMorgan's annual investor day, the bank announced that it would allow clients to purchase spot Bitcoin ETFs.
Although this move does not include the custody of cryptocurrencies or formal advice, it opens the door for indirect exposure to Bitcoin, as the bank manages $6 trillion in customer deposits.
The U.S. markets will be closed on May 26. Therefore, any optimism stemming from the postponement of tariffs between the U.S. and Europe may be dampened by concerns over U.S. government debt and the potential threat of an economic recession.
Although the data from the Bitcoin derivatives market remains healthy, the upcoming economic data is crucial for market sentiment. The market is closely watching the Richmond Fed Manufacturing Index, set to be released on May 28, as well as the Personal Consumption Expenditures (PCE) inflation data scheduled for May 30. These indicators could affect risk appetite and the likelihood of Bitcoin breaking through $112,000 in the short term.
Today's fear index is in a state of greed.
The market pulled back; yesterday's strategy is still in use today, or spot longs can just place a few more orders downwards, a few points apart, and a spike can connect. Last night, there was news that Trump was going to invest $3 billion in crypto, but this morning it was denied, causing the market that was about to rebound to be brought down again. Driven by news, the market changes daily, but the good thing is that institutions continue to buy. During the day, focus on Bitcoin at 105,000 and Ethereum at 2450. Once we reach a critical position, we'll see if there are any buying opportunities; there's no need to keep staring at it, it's meaningless.
