Structurally, the contract data and price for $MAGMA have diverged (open interest down, price up): over 24 hours, open interest fell 21.19%, while the price rose 12.98%. Current price: 0.3753.
Next, watch for two things:
First, whether open interest starts rising again—a recovery could indicate new long positions entering. Second, whether the price loses momentum. If open interest keeps falling while the price flattens out, it often means short covering is nearly over.
Next, watch for two things:
First, whether open interest starts rising again—a recovery could indicate new long positions entering. Second, whether the price loses momentum. If open interest keeps falling while the price flattens out, it often means short covering is nearly over.