The beginning rule of Bitcoin (BTC) trading should exist "expect the unexpected." In just the past year alone, there have been 5 instances of 20% or higher daily gains, too as five intraday 18% drawdowns. Truth to exist told, the volatility of the past iii months has been relatively modest compared to recent peaks.

Bitcoin historical xc-solar day annualized volatility. Source: TradingView

Whether they ar multimillion dollar institutional fund managers or retail investors, traders new to Bitcoin are often mesmerized by a nineteen% correction after a local top. Even more than shocking to many is the fact that the current $13,360 correction from the November. x $69,000 all-time high took place over ix days.

The downside move did not trigger alarm-raising liquidations

Cryptocurrency traders are notorious for high-leverage trading and in just the past four days, nearly $600 million worth of long (purchase) Bitcoin futures contracts were liquidated. That might sound like a decent enough number, just it represents less than 2% of the total BTC futures markets.

Bitcoin futures aggregate open up interest. Source: Coinglass.com

The kickoff testify that the 19% drop down to $56,000 marked a local lesser is the lack of a significant liquidation effect, despite the precipitous cost move. Had there been excessive buyers' leverage at play, a sign of an unhealthy market, the open up interest would have shown an abrupt change, like to the one seen on Sept. 7.

The options markets' chance guess remained at-home

To determine how worried professional traders are, investors should clarify the 25% delta skew. This indicator provides a reliable view into "fear and greed" sentiment past comparing similar telephone call (buy) and put (sell) options side by side.

This metric will turn positive when the neutral-to-bearish put options premium is higher than like-adventure call options. This state of affairs is usually considered a "fear" scenario. The contrary tendency signals bullishness or "greed."

Bitcoin 30-twenty-four hours options 25% delta skew. Source: Laevitas.ch

Values between negative 7% and positive 7% are deemed neutral, and so nix out of the ordinary happened during the contempo $56,000 support examination. This indicator would take spiked to a higher place x% had pro traders and arbitrage traders detected higher risks of a market collapse.

Margin traders are still going long

Margin trading allows investors to borrow cryptocurrency to leverage their trading position, therefore increasing the returns. For example, one can purchase cryptocurrencies by borrowing Tether (USDT) and increasing their exposure. On the other hand, Bitcoin borrowers tin only short information technology as they bet on the price decrease.

Unlike futures contracts, the residual between margin longs and shorts isn't always matched.

OKEx USDT/BTC margin lending ratio. Source: OKEx

The above chart shows that traders have been borrowing more USDT recently, as the ratio increased from vii on Nov. 10 to the current xiii. The data leans bullish considering the indicator favors stablecoin borrowing by 13 times, then this could be reflecting their positive exposure to Bitcoin toll.

All of the above indicators testify resilience in the face of the recent BTC price drop. As previously mentioned, anything can happen in crypto, only derivatives data hints that $56,000 was the local bottom.

The views and opinions expressed hither are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves chance. You should conduct your own research when making a conclusion.