On November 7, Bitcoin (BTC) fell to $34,500 as analysts turned their attention to growing open interest.
‘Surge’ in open interest unnerves Bitcoin experts
Data comes from Cointelegraph Markets Pro and trading view Showing that BTC price trajectory is struggling to regain the $35,000 support.
The largest cryptocurrency lacked clear direction at the open on Wall Street, but market participants predicted a return of volatility soon.
The reason, they said, was a sharp increase in open interest (OI) in the derivatives market.
“Nearly 10,000 BTC (approximately $350MM) in open interest increased today. There will be fireworks soon,” financial commentator Tedtalksmacro expected same day.
As Cointelegraph reported, high levels of open interest have been accompanied by several rounds of volatility in recent months.
Comment At current levels, the total value of each piece of data at the time of writing is nearly $15.5 billion coin glassJames Van Straten, a research and data analyst at cryptocurrency insights firm CryptoSlate, described the volatility as “spectacular.”
“The open interest of the CME exchange, which is favored by institutional investors, has reached a new record, with 105,380 open BTC contracts worth $3.68 billion. Binance has exceeded this number, with approximately 113,500 BTC open interest.” he pointed out.
“This trend indicates increasing participation in Bitcoin futures, suggesting a positive shift in market sentiment or a shift by investors towards protective strategies.”
JA Maartunn, a contributor to the on-chain analytics platform CryptoQuant, is also unsure about how the OI phenomenon will develop.
Bitcoin – Low timeframe
open interest #bitcoin Futures are rising. Certain apes are taking important positions, but it’s not clear to me whether they are short or long. pic.twitter.com/47anTWRAaA
— Maartun (@JA_Maartun) November 7, 2023
In the previous day’s analysis, he stated that OI is now in the area where BTC price fell by 20% previously.
“Historically, whenever this metric exceeds $12.2 billion, it causes the price of Bitcoin to fall by at least 20%,” he said. wrote On X, Osteogenesis Imperfecta is said to be of “high concern”.
Analysis: BTC price at $36,000 “off the radar” this week
Popular trader Skew continues the report, mentioning the importance of current price levels on shorter time frames.
Related: Unusually high – Bitcoin ordinal pushes BTC transaction fees to 5-month high
He told X subscribers that whoever moves in the “wrong” direction will face difficulties, triggering potential price swings.
Bitcoin USD
Looks like a short covering rally hereSome OI here have also come out of their lows pic.twitter.com/S6d0QuhCTi
— Skew Δ (@52kskew) November 7, 2023
Looking ahead, monitoring resource Material Indicators concluded that $36,000 will remain the cap for the time being.
“Putting a local high of $36,000 doesn’t mean a move above $36,000 won’t be considered this year, but the indicators I’m looking at suggest that won’t be the case this week at least,” Part of X analysis Nov. 6 read.
“This forecast also doesn’t mean prices will be free to fall back to the previous $25,000 to $28,500 range, but if this month’s bull market breakout is not confirmed, the range low will be crucial.”
This article does not contain investment advice or recommendations. Every investment and trading activity involves risks, and readers should do their own research when making decisions.
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