Hedge Funds Start To Bet On A Bitcoin Rally

U.S. hedge funds are starting to turn bullish on Bitcoin (CRYPTO: $BTC).

The so called "smart money" is starting to shift from shorting Bitcoin, or betting that the price will continue to fall, to wagering on a rally in the biggest cryptocurrency by market capitalization. 

Data analytics firm CryptoQuant says that hedge funds trading Bitcoin futures on the Chicago Mercantile Exchange (NASDAQ: $CME) have turned net long the cryptocurrency. 

The shift in positioning suggests that professional traders and money managers are starting to bet that Bitcoin's price will rise in coming months after declining throughout the year.

"The suits are now betting on Bitcoin's upside," said CryptoQuant in a report. 

Leading U.S. hedge funds that include names such as Citadel, Bridgewater Associates, and Renaissance Technologies have been negative on crypto for much of the past year.

But sentiment now appears to be shifting, according to CryptoQuant. 

That said, Bitcoin continues to remain rangebound, trading between $60,000 U.S. and $65,000 U.S., a spectrum it has been stuck in since the end of June. 

Bitcoin hit a low for the year of $58,000 U.S. at the end of June. CryptoQuant says the current action in futures markets suggest that many traders see that level as a bottom for BTC.

Bitcoin is trading at $64,800 U.S. on Aug. 10, about half the level it was at last October when it hit an all-time high of just over $126,000 U.S.