Bitcoin is in a high-risk zone, and in my opinion, it's not the best time for fresh long positions. This is mainly because of a very high amount of Open Interest.
Open Interest represents the total value of contracts (in USD) within the Bitcoin Futures market. It provides insights into how investors are speculating on rising Bitcoin prices, often accompanied by leverage, which can make these positions quite fragile.
Since March 2024, Open Interest has surpassed $18 billion on six separate occasions, each time leading to a local price peak. Currently, we are above that threshold for the seventh time, which raises my concerns.
Take care, everyone!
Written by maartunn