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During the October-December correction, the crypto derivatives market got rid of excess leverage. The subsequent restrained recovery in positions indicates the prevalence of conservative sentiment among traders, analysts at Glassnode say.
The #Bitcoin market hovers precariously below $50k, as the bulls, and bears draw their lines in the sand.
After a significant deleveraging in derivatives markets, onchain data provides insight into the most likely $BTC move.
Read more in The Week Onchainhttps://t.co/1hRY4Swkoz
— glassnode (@glassnode) December 13, 2021
The volume of open interest (OI) in bitcoin futures decreased by 12.9% from the peak (by more than 50,000 BTC). Previously, it exceeded the signal value of 380,000 BTC, which served as a signal for subsequent liquidations.
Over the past week, OI has grown “only” by 5,000 BTC. Acceleration of the trend will indicate an increase in the likelihood of stop-loss formation around the existing trading range.
Data: Glassnode.
The daily trading volume in Bitcoin futures at its peak exceeded 2 million BTC, which is comparable to the sharp decline in OI in May and September.
Data: Glassnode.
In the market for perpetual contracts, for the first time since October, financing rates went into the negative zone, which coincided with the current minimum during the current correction.
Analysts saw this as another confirmation of long liquidation. The lack of active recovery of the indicator is also a signal of the expectant sentiment of crypto traders.
Data: Glassnode.
Recall that Glassnode analysts recorded the resumption of the withdrawal of bitcoins from exchanges to wallets.
#crypto #derivatives #market #traders #cautious
