The Ethereum OI data has dropped from $13 billion to $11.5 billion, giving the market some breathing space.
Open Interest represents the total of long and short positions in the market. The higher it is, the more heated we can assume the market to be.
The Ethereum OI data peaked at around $9.5 billion during the previous bull run when the price reached an all-time high of $4,891 in 2021. However, despite not having refreshed its ATH in the current bull cycle, Ethereum, the leader of altcoins, saw its OI data reach $13 billion, setting a new record. This led to an overheating of the market specifically for Ethereum.
After such a substantial number of leveraged positions were opened, liquidations followed without delay.
Since June 5, 2024, when Ethereum OI data reached its ATH, approximately $400 million worth of Ethereum positions have been liquidated till then. Long positions exceeding $285 million were liquidated. On thje other hand, $113 million worth of short positions were liquidated over the same period.
Following this significant increase in OI data, a sharp correction ensued, with OI data pulling back by $1.5 billion to $11.5 billion.
Whether this pullback in OI data is sufficient will be determined by market makers, but we can say that the boiling water has cooled down a bit.
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Written by burakkesmeci