The VELVET 15-minute chart moves a bit too violently.
A drop of 2.55% isn’t outrageous, but the underlying data is worth taking a closer look. OI was cut by 4% within one minute, and the notional open interest shrank by 470k U directly. The deleveraging feel is very strong—more like longs are being forced to cut losses repeatedly, rather than a simple pullback. Especially troubling is that the aggressive order flow is down to -38%; the sell pressure is almost crushing, and buyers simply can’t catch the falling moves.
Look a bit deeper: this contract has been ranking high on the OI abnormal leaderboard for several consecutive cycles. A 99.8th percentile reading means that, historically, it rarely shows this kind of sharply shrinking positioning. Trading volume is 15 times the norm and still ranks at the top of the whole pool. This is not a move that retail traders could push.
Plainly put: before the mess is all over the floor, someone always runs first.
With a 24-hour turnover of only 16 million U, at this liquidity level any small breeze will be magnified. At this point, instead of trying to guess the bottom, it’s better to first see whether the positioning can stabilize. Unless OI holds steady, any price rebound is just illusory.
A drop of 2.55% isn’t outrageous, but the underlying data is worth taking a closer look. OI was cut by 4% within one minute, and the notional open interest shrank by 470k U directly. The deleveraging feel is very strong—more like longs are being forced to cut losses repeatedly, rather than a simple pullback. Especially troubling is that the aggressive order flow is down to -38%; the sell pressure is almost crushing, and buyers simply can’t catch the falling moves.
Look a bit deeper: this contract has been ranking high on the OI abnormal leaderboard for several consecutive cycles. A 99.8th percentile reading means that, historically, it rarely shows this kind of sharply shrinking positioning. Trading volume is 15 times the norm and still ranks at the top of the whole pool. This is not a move that retail traders could push.
Plainly put: before the mess is all over the floor, someone always runs first.
With a 24-hour turnover of only 16 million U, at this liquidity level any small breeze will be magnified. At this point, instead of trying to guess the bottom, it’s better to first see whether the positioning can stabilize. Unless OI holds steady, any price rebound is just illusory.
