{"id":14493,"date":"2025-02-22T13:46:33","date_gmt":"2025-02-22T13:46:33","guid":{"rendered":"https:\/\/dogewisperer.com\/?p=14493"},"modified":"2025-02-22T13:46:33","modified_gmt":"2025-02-22T13:46:33","slug":"bitcoin-breaks-99000-but-analyst-warns-rally-leverage-driven","status":"publish","type":"post","link":"https:\/\/dogewisperer.com\/?p=14493","title":{"rendered":"Bitcoin Breaks $99,000, But Analyst Warns Rally \u2018Leverage Driven\u2019"},"content":{"rendered":"
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Bitcoin has seen a recovery above $99,000 recently, but the trend taking place in the Open Interest could raise concerns about the surge\u2019s longevity.<\/p>\n

Bitcoin Open Interest Has Spiked Alongside The Latest Rally<\/h2>\n

In a new post<\/a> on X, CryptoQuant community analyst Maartunn talked about the trend in the Bitcoin Open Interest alongside the latest price rally. The \u201cOpen Interest<\/a>\u201d here refers to an indicator that keeps track of the total amount of positions related to BTC that are currently open on all derivatives exchanges.<\/p>\n

When the value of this metric rises, it means the derivatives users are opening fresh positions. Generally, the total amount of leverage<\/a> goes up in the sector as new positions pop up, so this kind of trend can lead to higher volatility for the asset\u2019s price.<\/p>\n

On the other hand, the indicator\u2019s value registering a decline implies the holders are either closing up positions of their own volition or getting liquidated by their platform. The cryptocurrency may act in a more stable manner following such a leverage flushout.<\/p>\n

Now, here is the chart shared by the analyst, that shows the trend in the Bitcoin Open Interest, as well as its 24-hour percentage change, over the last week:<\/p>\n

\"Bitcoin<\/p>\n

From the above graph, it\u2019s visible that the Bitcoin Open Interest has seen a rapid increase alongside the latest recovery rally in the coin\u2019s price. At the peak, the 24-hour percentage change hit the 7.2% mark, which is quite significant.<\/p>\n

While it\u2019s normal for speculative activity to follow a sharp move in the cryptocurrency, an excess of it can still be an alarming sign. This is because in a high-leverage environment, the chances of a mass liquidation event can become notable.<\/p>\n

In theory, the volatility emerging out of such derivatives market chaos can take the cryptocurrency in either direction, but usually, Open Interest spikes that accompany rallies end up acting as an impedance for it. Thus, it\u2019s possible that the latest Bitcoin rally may also unwind in a volatile manner.<\/p>\n

The trend in the Open Interest isn\u2019t the only one that suggests volatility could be coming for the asset, as the analytics firm Glassnode has pointed out in an X post<\/a>.<\/p>\n

\"Bitcoin<\/p>\n

The chart shared by the analytics firm is for the 1-week Realized Volatility<\/a>, an indicator that tracks the percentage change between the highest and lowest points in the Bitcoin price recorded during the last seven days.<\/p>\n

As displayed in the graph, the metric\u2019s value has plunged recently, implying the asset has been trading inside a very narrow range. \u201cIn the past four years, it has dipped lower only a few times \u2013 e.g., Oct 2024 (22.88%) & Nov 2023 (21.35%),\u201d explains Glassnode. \u201cSimilar compressions in the past led to major market moves.\u201d<\/p>\n

BTC Price<\/h2>\n

Following a jump of around 2% in the last 24 hours, Bitcoin has recovered back above the $99,300 level.<\/p>\n

\"Bitcoin<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Bitcoin has seen a recovery above $99,000 recently, but the trend taking place in the Open Interest could raise concerns about the surge\u2019s longevity. Bitcoin Open Interest Has Spiked Alongside The Latest Rally In a new post on X, CryptoQuant community analyst Maartunn talked about the trend in the Bitcoin Open Interest alongside the latest […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"iawp_total_views":0,"footnotes":""},"categories":[2],"tags":[3,4,5],"class_list":["post-14493","post","type-post","status-publish","format-standard","hentry","category-news","tag-crypto","tag-doge","tag-news"],"_links":{"self":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts\/14493","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14493"}],"version-history":[{"count":0,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts\/14493\/revisions"}],"wp:attachment":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14493"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14493"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14493"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}