Bitcoin Futures Open Interest Hits $19 Billion, Harsh Intraday Swings, Analyst Says 'Fresh Rally' Expected

As the digital currency markets turned this week, the total market capitalization of the cryptocurrency field dropped by billions. One report from Luno and Arcane Research indicates that February 23 recorded the third largest bitcoin daily trade volume in history as $18 billion was transferred between the spot market. Bitcoin futures open interest topped $19.5 billion on Tuesday, as bitcoin price volatility touches an all-time high on Sunday, reaching $58,354 per coin. Bitcoin’s value fell below the $50k handle on Tuesday to touch bottom at $48,846 per coin.

During the two price ranges, much of Bitcoin's market valuation was eliminated, with over 23% wiped off its valuation In a Row

After bitcoin (BTC) touched an all-time price high on Sunday, hitting $58,354 per unit, bitcoin’s value slipped below the $50k handle touching bottom at $44,846 per coin. The loss between these two price ranges saw over 23% shaved off BTC’s market valuation.

While heavy losses were seen across the board throughout the entire crypto-economy, a report from Luno and Arcane Research shows that Tuesday’s trade volume was the third-largest ever seen. Bitcoin is down from $57k to $46k before recovering to $54k yesterday. Those fluctuations continued this morning as BTC dropped from $54k to $45k from the opening.

There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”It also said bitcoin derivatives had Comment on this subject below.snowballed in the bitcoin market” and had Comment on this subject below.pivoted at $19.1 billion this Sunday.” There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”Bitcoin dropped from $57k to $46k yesterday before recovering to $54k. This volatility continued this morning, as BTC dropped from the opening around $54k and all the way down to $45k. A note from Balani to investors stated, Comment on this subject below.Despite the correction.”

Luno’s report says that traders should be There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”very careful with leveraged positions, both longs and shorts.” It also said that bitcoin derivatives have been There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”snowballing in the bitcoin market” and had There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”peaked at $19.1 billion this Sunday.” There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”Yesterday’s sell-off pulled out some steam from the leveraged futures market, but the climate is still hot,” Luno’s study emphasizes.

Balani is expecting Comment on this subject below.short-term consolidation” in BTC’s price for now.

Pankaj Balani, CEO of Delta Exchange, a digital asset derivatives trading platform says the recent bitcoin (BTC) correction was healthy.

There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”Despite the correction,” Balani said in a note to investors. There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”The bull market and the case for a stronger rally in bitcoin remains intact. This is only the second correction in BTC prices since November, when bitcoin broke above its previous ATH and started a fresh rally. Comment on this subject below.The funding rates have fallen back to neutral territory, leaving the market looking healthier,” said Arcane Research to investors this week. Balani expects a There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”short-term consolidation” in BTC’s prices for now.

#bitcoin futures volume all-time-high yesterday pic.twitter.com/steg99xA58

— skew (@skewdotcom) February 24, 2021

The findings in Luno and Arcane Research show that between February 1 to Feb. 22nd, bitcoin futures open interest (OI) climbed by 63% outpacing BTC’s price rise which was only 57%.

There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”The open interest outpacing the bitcoin performance should be a concerning sign as it shows that the leverage $10 [billion] is picking up,” Luno said. There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”While the OI is a result of both longs and shorts, the huge premiums in the futures market lately indicate that leveraged upside exposure has $5b been the main contributor to the rising OI. In no event will the author or company be liable for any damage caused or alleged to have been caused by or in connection with the use of or reliance on any of the content, goods, or services mentioned in this article.

The dramatic BTC derivatives fever has seemingly cooled down as Luno and Arcane’s findings show some of the futures OI had dissipated following the sell-off.

There are no daily volatility metrics that reflect this yet as they are measured using daily close prices,” the report says.Luno’s report suggests traders Comment on this subject below.be careful with leveraged positions, both long and short.”The start of the week saw significant drops in the value of digital currencies, with many crypto markets losing billions of dollars in value. For now, bitcoin traders are changing positions and strategies after the dump, and focusing on BTC’s next big move.

Furthermore, bitcoin futures open interest increased to $19.1 billion, with intraday swings close to 20% for two days in a row. Over 23% of Bitcoin's market value was lost between these two price intervals. Despite heavy losses being experienced across the board, a report released by Luno and Arcane Research shows that Tuesday's trading volume was the thirst largest ever seen.

Bitcoin Price Drops 18%, Fed Discusses 'Soft' Inflation, Analyst Says BTC Sell-Off Attracts More Investors

MARKET UPDATES | 3 days ago

Bitcoin Taps $48K- Traders Discuss Overheated Stats and a Possible Chinese New Year Dump

MARKET UPDATES | Feb 9, 2021

Tags in this story

Image Credits: Shutterstock, Pixabay, Wiki Commons, Twitter, Luno, Arcane Research,