$STRK Yesterday morning, at 0.0720, I said I was siding with the whales for a short-term trade. At 8 p.m., one hourly candle slammed through 0.0716 and hit a low of 0.0654. My stop-loss, placed below the three previous lows, was triggered on the spot. Today it fell to a new low of 0.0622, down by more than half from the October 11 high of 0.1265.
Let me be clear about where I got it wrong: I interpreted “price falling, open interest rising, and whales’ long position share holding steady” as whales putting in a floor. Whales are accumulating tokens, not supporting the price—and after they accumulate, the price can still get smashed through. During yesterday’s 8 p.m. hour, 177 million tokens were aggressively sold in futures, while only 121 million were aggressively bought. Open interest fell from 411 million tokens to 382 million by 3 a.m. today, a 7% drop. That was longs getting stopped out in droves.
Today’s picture has almost repeated itself exactly. Futures open interest, measured in tokens, rose from 382 million at 3 a.m. to 430 million at 5 p.m.—up 12.6% in 14 hours—while the price moved from 0.0654 to the current 0.0629. Whales’ long share has stayed stuck between 65.6% and 65.7%, while the share of accounts across the market taking long positions fell from 51.0% to 48.9%. The funding rate is still at the default positive 0.005%, so shorts haven’t paid a cent more.
Put simply, whales are still adding to their longs as the price falls. The 48 million tokens added today were mostly bought at prices between 0.062 and 0.066. If 0.0622 gives way, all those longs will be underwater, and their stop-loss orders will become ready-made sell orders. We could see a repeat of what happened at 8 p.m. last night.
Technically, daily closes have stayed above the EMA26 since October 5. That line is at 0.0637 today, and the current price has already slipped below it. The 4-hour KDJ J-value is just 4.4, so the market is indeed oversold in the short term. That’s why I won’t chase shorts here. The 4-hour Bollinger lower band is at 0.0564.
My view is that this rise in open interest doesn’t count as support. 0.0622 will probably be tested again; if it breaks, the first level to watch is 0.0600, followed by 0.0564. I’ll only admit these longs have held up if the 4-hour candle closes back above 0.0660 and open interest hasn’t fallen. I’m currently flat STRK. I’ve accepted yesterday’s small loss.
#STRK #FuturesOpenInterest
Let me be clear about where I got it wrong: I interpreted “price falling, open interest rising, and whales’ long position share holding steady” as whales putting in a floor. Whales are accumulating tokens, not supporting the price—and after they accumulate, the price can still get smashed through. During yesterday’s 8 p.m. hour, 177 million tokens were aggressively sold in futures, while only 121 million were aggressively bought. Open interest fell from 411 million tokens to 382 million by 3 a.m. today, a 7% drop. That was longs getting stopped out in droves.
Today’s picture has almost repeated itself exactly. Futures open interest, measured in tokens, rose from 382 million at 3 a.m. to 430 million at 5 p.m.—up 12.6% in 14 hours—while the price moved from 0.0654 to the current 0.0629. Whales’ long share has stayed stuck between 65.6% and 65.7%, while the share of accounts across the market taking long positions fell from 51.0% to 48.9%. The funding rate is still at the default positive 0.005%, so shorts haven’t paid a cent more.
Put simply, whales are still adding to their longs as the price falls. The 48 million tokens added today were mostly bought at prices between 0.062 and 0.066. If 0.0622 gives way, all those longs will be underwater, and their stop-loss orders will become ready-made sell orders. We could see a repeat of what happened at 8 p.m. last night.
Technically, daily closes have stayed above the EMA26 since October 5. That line is at 0.0637 today, and the current price has already slipped below it. The 4-hour KDJ J-value is just 4.4, so the market is indeed oversold in the short term. That’s why I won’t chase shorts here. The 4-hour Bollinger lower band is at 0.0564.
My view is that this rise in open interest doesn’t count as support. 0.0622 will probably be tested again; if it breaks, the first level to watch is 0.0600, followed by 0.0564. I’ll only admit these longs have held up if the 4-hour candle closes back above 0.0660 and open interest hasn’t fallen. I’m currently flat STRK. I’ve accepted yesterday’s small loss.
#STRK #FuturesOpenInterest