XRP trading volume exploded to 7.4 billion, and everyone’s yelling “CME short squeeze.” I went to check the raw data: CME leveraged funds cut net shorts by 46.3 million XRP—this part is real. But those three products on Coinbase barely moved.
This divergence is what I care about. The price pushed up by shorts closing their positions is a completely different thing from the price pushed up by spot buy-side demand. The former is position adjustment; the latter is actual demand.
I don’t predict direction. I’m only talking about how to read it: in this kind of market, people who chase breakouts are very likely to become the counterparty for shorts covering (to close and profit). My DCA plan doesn’t include XRP—not because I don’t like it, but because I don’t understand it, so I won’t bet on it 🙃
This divergence is what I care about. The price pushed up by shorts closing their positions is a completely different thing from the price pushed up by spot buy-side demand. The former is position adjustment; the latter is actual demand.
I don’t predict direction. I’m only talking about how to read it: in this kind of market, people who chase breakouts are very likely to become the counterparty for shorts covering (to close and profit). My DCA plan doesn’t include XRP—not because I don’t like it, but because I don’t understand it, so I won’t bet on it 🙃