$MAGIC In one hour, it plunged from 0.161 to 0.098, down nearly 39%, but futures open interest barely moved: it peaked at 143.4 million tokens and is still at 141.3 million, a drop of just 1.5%.
In a typical cascade, longs get liquidated and open interest shrinks sharply along with them. This time, the price fell by nearly half, yet positions stayed in the market. That suggests this wasn't simply a long liquidation; someone likely opened a large number of short positions at higher levels, riding the move down and catching this falling knife.
Now look at the funding rate: it's currently -0.46%, meaning shorts have to pay longs nearly half a percentage point every 8 hours. Shorts can't bear this cost for long: either the price keeps falling and gives them profits, or they'll be forced to cover.
The long-short ratios are changing too. The retail account long-short ratio has risen from 0.69 to 1.01, suggesting dip buyers have entered. The large-trader position long-short ratio has climbed from 1.15 to 1.24, so large traders are also adding to their long positions. Crowded shorts, large traders leaning long, and open interest holding steady: taken together, I lean toward a short squeeze as the next move, rather than a second cascade.
Technically, the 1-hour RSI is 43. The price at 0.1076 is below the Bollinger midline at 0.1266, but above the EMA50 at 0.102; the EMA200 is at 0.0756, so the broader structure hasn't broken down yet. First, watch the rebound high at 0.118 above; reclaiming it would open up room for a short squeeze. Below, 0.098 is the wick low—if that breaks, it would mean the shorts were right.
I don't have a MAGIC position myself. Tonight, I'm watching just two things: whether the funding rate keeps getting more negative, and whether open interest starts falling around 0.102. As long as the EMA50 holds and funding remains deeply negative, I think shorts are in a tougher spot than longs.
#MAGIC #FuturesOpenInterest
In a typical cascade, longs get liquidated and open interest shrinks sharply along with them. This time, the price fell by nearly half, yet positions stayed in the market. That suggests this wasn't simply a long liquidation; someone likely opened a large number of short positions at higher levels, riding the move down and catching this falling knife.
Now look at the funding rate: it's currently -0.46%, meaning shorts have to pay longs nearly half a percentage point every 8 hours. Shorts can't bear this cost for long: either the price keeps falling and gives them profits, or they'll be forced to cover.
The long-short ratios are changing too. The retail account long-short ratio has risen from 0.69 to 1.01, suggesting dip buyers have entered. The large-trader position long-short ratio has climbed from 1.15 to 1.24, so large traders are also adding to their long positions. Crowded shorts, large traders leaning long, and open interest holding steady: taken together, I lean toward a short squeeze as the next move, rather than a second cascade.
Technically, the 1-hour RSI is 43. The price at 0.1076 is below the Bollinger midline at 0.1266, but above the EMA50 at 0.102; the EMA200 is at 0.0756, so the broader structure hasn't broken down yet. First, watch the rebound high at 0.118 above; reclaiming it would open up room for a short squeeze. Below, 0.098 is the wick low—if that breaks, it would mean the shorts were right.
I don't have a MAGIC position myself. Tonight, I'm watching just two things: whether the funding rate keeps getting more negative, and whether open interest starts falling around 0.102. As long as the EMA50 holds and funding remains deeply negative, I think shorts are in a tougher spot than longs.
#MAGIC #FuturesOpenInterest