Bitcoin is trading at September highs, returning after surpassing $66,000 on October 14. Although the coin is trading lower at spot rates, the path of least resistance appears to the north and the trend changes, aligning with Q1 2024 gains.
Bitcoin Open Interest Rises, Approaching $40 Billion
After months of lows, the world’s most valuable coin is flying away, and with it, the feeling is getting better. The latest market data shows that Bitcoin open interest on all major derivatives exchanges is approaching an all-time high.
According to Coinglass, open interest pink to over $39 billion in March 2024. As of October 15, Bitcoin open interest exceeded $37.6 billion, up from $34.6 billion yesterday.
Open interest is generally used to gauge trader interest. The exchange data combines the count of all leveraged short and long positions posted by traders on major exchanges including Binance and Bybit.
Since open interest is non-directional and does not indicate whether there are more buyers or sellers at any given time, the metric gauges traders’ interest and willingness to engage.
Every time cryptocurrency prices rise, as was the case beginning in the fourth quarter of 2023, open interest began to swell before peaking at an all-time high of over $39 billion in March 2024.
The drop in Bitcoin prices from the second quarter of 2024 also coincided with a contraction in open interest. On August 6, when BTC fell below $50,000, Bitcoin open interest fell below $26 billion before gradually recovering.
Will BTC prices exceed $74,000?
Considering the growth rate over the past 24 hours, it is highly likely that any breakout and close above $66,000 could prompt more traders to open leveraged positions. In this case, Bitcoin open interest would exceed $40 billion, reaching an all-time high.
Based on the daily chart, Bitcoin strongly rejected $66,000, marking its all-time high in September. However, if the October 14 surges return, prices could rise, returning to July 2024 highs of $70,000. For now, traders are confident that prices will match September’s gains and climb back toward March highs.
Although confidence is high, data on Coinglass’s long-to-short ratio revealed fewer long volumes than short volumes. Currently, 51% of BTC trading volume is sales, while 49% is purchase volume. This data indicates that most traders are still bearish.
Featured image from Canva, chart from TradingView
