Shorts have only outnumbered longs on a handful of occasions this year without being promptly liquidated.
The game plan A wick below the last low ($6400) would likely increase this ratio further giving the big players a perfect short squeeze opportunity.
But it is a bear market? Regardless of the trend, a crowded trade should be avoided. For every position in "your favour" is another position that is wanting to buy/sell in the same region as you (including long), if you are able to create a path of less resistance by liquidating competing positions it will allow you to either exit lower/higher in your favour or close with less slippage.
Reservations After the squeeze, there is a possibility the downtrend can continue to lower lows.
Not much analysis to give, however, sharing this idea to free up some chart space and potentially give some helpful insight to someone.
Also, think it's worth keeping an eye on BitMex Perpetual XBTUSD funding rate, negative rates mean more shorts open than longs, and shorts pay longs. We've had a few solid days of sustained high negative rates (~100% annualized interest).
abztrdr
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@longbwk, Thanks for bringing that up. Not check that all weekend!