2024

Bitcoin

when

The Bitcoin (<a href="https://cointelegraph.com/bitcoin-price">BTC</a>) market is at an “inflection point” after a historic Bitcoin 2024 conference that has seen BTC futures open interest break out of range, according to analysts.
“We finally have a breakout of this range,” declared independent analyst Horse, referring to Bitcoin’s futures open interest.
Open interest (OI) refers to the total number of BTC-related derivative contracts currently open on all exchanges.
A rise in this metric suggests that investors are opening new positions in the derivative market. Generally, the total leverage in the market goes up when new contracts crop up, so an increase in OI could lead to higher volatility for the asset.
Independent market analyst Horse <a href="https://x.com/TheFlowHorse/status/1817901801938522603" target="_blank" rel="noopener nofollow">shared</a> the following chart showing that Bitcoin’s OI on Coinbase Pro had broken above a level that had held it down since March when <a href="https://cointelegraph.com/news/bitcoin-price-new-73-6-k-all-time-high-etfs-eat">BTC price hit new all-time highs</a>.
<figure>
 <img src="https://s3.cointelegraph.com/uploads/2024-07/e6615f8f-edf0-4a06-a545-dbf629b62151.jpeg" alt="Bitcoin traders flag ‘inflection point’ in key futures market metric as BTC breaks range">
 <figcaption style="text-align: center;">
 BTC/USD chart vs. OI on Coinbase Pro. Source: Horse
 </figcaption>
</figure>
Bitcoin OI had risen alongside the price as the rally was fueled by a shift in US politics toward pro-crypto narratives.
Horse referred to former US President <a href="https://cointelegraph.com/news/bitcoin-wobbles-trump-delivers-pro-crypto-conference-speech">Donald Trump’s remarks</a> at the Bitcoin 2024 Conference in Nashville on July 27, saying that the sector was handed every bullish thing on a silver platter. 
<blockquote>
 “It is debatable whether or not they actually come to fruition, but you are now a bit more obligated to be long-term bullish on this asset class either way.”
</blockquote>
Horse explained that <a href="https://cointelegraph.com/news/btc-price-dips-us-govt-bitcoin-move-new-sell-off-fears#:~:text=Bitcoin%20falls%20below%20%2467%2C000%20in,time%20in%20nearly%20two%20months.">Bitcoin price</a> was trading higher following Trump’s speech, as long bets in both perpetual and options markets were closed out. “This is very bullish,” he said.
<blockquote>
 “Fresh longs here are poor from an r:r basis. It definitely favors shorts or at least hedges if you went off that alone, which would be terribly stupid but worth noting. This is because the invalidation is so close, i.e., hedge 69+, close on a break of the highs.”
</blockquote>
Fellow analyst Skew <a href="https://x.com/52kskew/status/1817906679595569370" target="_blank" rel="noopener nofollow">shared</a> similar sentiments, saying that the overall Bitcoin perpetual futures market was “net long.”
Related: <a href="https://cointelegraph.com/news/bitcoin-pushes-toward-70k-day-after-trump-bitcoin-conference">Bitcoin pushes toward $70K — just 6% needed for new all-time high</a>
Skew added that “constant spot buying” would be required for the price to break to $72,000, which would cover the risks that longs currently carry. 
<blockquote>
 “However, it’s pretty apparent that if spot buying stops for a bit, the direct risk of forced long de-leveraging would be pretty clear (it often ends up as a quick wick into market bid liquidity). The market is at an inflection point.”
</blockquote>
As predicted by Skew, Bitcoin’s price has dropped lower, away from the $70,000 mark, to trade at $67,271, according to data from <a href="https://subscription.cointelegraph.com/?_gl=1*7499wx*_ga*MTQ0MzQ0NzI4Ny4xNzE2MzY1NTA0*_ga_53R24TEEB1*MTcxNjM2NTUwNC4xLjEuMTcxNjM2Njg2MC4wLjAuMA..">Cointelegraph Markets Pro</a> and <a href="https://www.tradingview.com/symbols/BTCUSD/?exchange=BINANCE" target="_blank" rel="noopener nofollow">TradingView</a>. This has resulted in the liquidation of more than $55.66 million long BTC leveraged positions over the last 24 hours, with $46.74 million liquidated over the last 4 hours alone.
<figure>
 <img src="https://s3.cointelegraph.com/uploads/2024-07/c4ed4faa-0221-45f9-8937-2ff849ddf3ad.png" alt="Bitcoin traders flag ‘inflection point’ in key futures market metric as BTC breaks range" title="">
 <figcaption style="text-align: center;">
 Total BTC liquidations across all exchanges. Source: CoinGlass
 </figcaption>
</figure>
However, with Bitcoin futures OI reaching <a href="https://cointelegraph.com/news/bitcoin-open-interest-394b-breakout-imminent">all-time highs above $39.4 billion</a>, BTC price could soon be on track to break out to new all-time highs, making the ongoing correction could be short-lived. 
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Bitcoin traders flag ‘inflection point’ in key futures market metric as BTC breaks range

Cointelegraph

Other articles published on Jul 29, 2024

Bitcoin Reaches 100 Days Since Last Halving Event

Cryptocurrency Maker Up More Than 3% In 24 hours

Interest rate cut on horizon: Will it be a boost to Bitcoin?

Render Token Faces Increased Selling Pressure

Chainlink’s PoR Boosts Security and Transparency for Wenia’s Colombian Peso Stablecoin

Ethereum ETF Impact: What’s Next as ETH Speed Slows Down?

Join our free newsletter for daily crypto updates!