$PYPL 24 hours only moved 1.11%, and the price stayed at 55.4, but the real story is in open interest. The open interest of 4,421 contracts is pitifully low. Trading volume was 45,000, and turnover was not low, yet the price hardly moved.
This shows one thing: most people here are just playing short-term trades, jumping in and out quickly, and very few are actually holding overnight. The funding rate is zero, so neither longs nor shorts are currently paying the other side.
From the perspective of political and military events, this kind of low-position structure is like a sheet of thin paper. If there were any sudden news, whether geopolitical tensions affecting cross-border payments or changes in policy direction, price fluctuations would be extremely violent because there are not many stop-loss orders underneath to block the way. Neither longs nor shorts have accumulated enough positions, so the market can easily move to extremes.
The strongest opposing view is that low open interest may also mean limited downside, after all, there are not many long positions that need to be closed and dumped. But I think the opposite interpretation is more accurate: when prices rise, there are not many shorts to be squeezed; when prices fall, there are not many longs to be buried either, so the price is likely to show a lack of resistance.
If there is any external disturbance next, quant funds and short-term traders will be the first to run, and their retreat will make liquidity even worse, amplifying volatility. The ones who pay the cost are the retail traders who react slowly.
Trading tag: #TradFi #链上美股 #PYPL
Where do you think this judgment is most likely to be wrong?
This shows one thing: most people here are just playing short-term trades, jumping in and out quickly, and very few are actually holding overnight. The funding rate is zero, so neither longs nor shorts are currently paying the other side.
From the perspective of political and military events, this kind of low-position structure is like a sheet of thin paper. If there were any sudden news, whether geopolitical tensions affecting cross-border payments or changes in policy direction, price fluctuations would be extremely violent because there are not many stop-loss orders underneath to block the way. Neither longs nor shorts have accumulated enough positions, so the market can easily move to extremes.
The strongest opposing view is that low open interest may also mean limited downside, after all, there are not many long positions that need to be closed and dumped. But I think the opposite interpretation is more accurate: when prices rise, there are not many shorts to be squeezed; when prices fall, there are not many longs to be buried either, so the price is likely to show a lack of resistance.
If there is any external disturbance next, quant funds and short-term traders will be the first to run, and their retreat will make liquidity even worse, amplifying volatility. The ones who pay the cost are the retail traders who react slowly.
Trading tag: #TradFi #链上美股 #PYPL
Where do you think this judgment is most likely to be wrong?