Bitcoin (BTC) has experienced a remarkable 15.7% price surge in the first six days of December. This surge has been heavily influenced by the anticipation of an imminent approval of a spot exchange-traded fund (ETF) in the United States. Senior Bloomberg ETF analysts have expressed a 90% probability for approval by the U.S. Securities and Exchange Commission, which is expected before Jan. 10.

However, Bitcoin’s recent price surge may not be as straightforward as it seems. Analysts have failed to consider the multiple rejections at $37,500 and $38,500 during the second half of November. These rejections have left professional traders, including market makers, questioning the market’s strength, particularly from the perspective of derivatives metrics.

Bitcoin’s inherent volatility explains pro traders’ reduced appetite

Bitcoin’s 7.6% rally to $37,965 on Nov. 15 resulted in disappointment as the movement fully retracted the following day. Similarly, between Nov. 20 and Nov. 21, Bitcoin's price declined by 5.3% after the $37,500 resistance proved more formidable than anticipated.

While corrections are natural even during bullish markets, they explain why whales and market makers are avoiding leveraged long positions in these volatile conditions. Surprisingly, despite positive daily candles throughout this period, buyers using long leverage were forcefully liquidated, with losses totaling a staggering $390 million in the past five days.

Although the Bitcoin futures premium on the Chicago Mercantile Exchange (CME) reached its highest level in two years, indicating excessive demand for long positions, this trend doesn't necessarily apply to all exchanges and client profiles. In some cases, top traders have reduced their long-to-short leverage ratio to the lowest levels seen in 30 days. This indicates a profit-taking movement and reduced demand for bullish bets above $40,000.

By consolidating positions across perpetual and quarterly futures contracts, a clearer insight can be gained into whether professional traders are leaning toward a bullish or bearish stance.

Exchanges’ top traders BTC long-to-short ratio. Source: Coinglass

Starting on Dec. 1, OKX's top traders favored long positions with a strong 3.8 ratio. However, as the price surged above $40,000, those long positions were closed. Currently, the ratio heavily favors shorts by 38%, marking the lowest level in over 30 days. This shift suggests that some significant players have stepped back from the current rally.

However, the entire market doesn't share this sentiment. Binance's top traders have shown an opposing movement. On Dec. 1, their ratio favored longs by 16%, which has since increased to a 29% position skewed towards the bullish side. Nevertheless, the absence of leveraged longs among top traders is a positive sign, confirming that the rally has primarily been driven by spot market accumulation.

Related: Canadian crypto exchanges reach $1B in assets under management

Options data confirms that some whales are not buying into the rally

To determine whether traders were caught off-guard and currently hold short positions underwater, analysts should examine the balance between call (buy) and put (sell) options. A growing demand for put options typically indicates traders focusing on neutral-to-bearish price strategies.

BTC options put-to-call volumes at OKX. Source: Laevitas.ch

Data from Bitcoin options at OKX reveals an increasing demand for puts relative to calls. This suggests that these whales and market makers might not have anticipated the price rally. Still, traders were not betting on a price decline as the indicator favored the call options in terms of volume. An excess demand for put (sell) options would have moved the metric above 1.0.

Bitcoin's rally toward $44,000 appears healthy, as no excessive leverage has been deployed. However, some significant players were taken by surprise, reducing their leverage longs and showing increased demand for put options simultaneously.

As Bitcoin's price remains above $42,000 in anticipation of a potential spot ETF approval in early January, the incentives for bulls to pressure those whales who chose not to participate in the recent rally grow stronger.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.