$AKE It got slammed three times in two days, and the move at 10 a.m. today pushed the low even lower. Here’s a review explaining how I see it.
Gate perpetuals are now around 0.00938, down about 29% over 24 hours, with a range of 0.00844 to 0.01316 and roughly 17 million U in volume. Bitcoin is basically flat around 77,800. That’s its own story. I couldn’t find any news that clearly lines up with this, so I’m only discussing the price action below.
The three drops:
From 1 to 2 a.m. yesterday, about 4.8 million U traded over two hours, driving the price from 0.0189 to 0.01346.
From 3 to 4 p.m. yesterday, about 8 million U traded over two hours, pushing the price down from around 0.0132 to 0.0092. This was the highest-volume stretch of the past two days.
At 10 a.m. today, about 3.39 million U traded in one hour, driving the price from 0.0114 down to 0.00844, a new low.
All three drops have one thing in common: very few longs were liquidated. During the hour from 10 a.m. today, only about 22,000 U of longs were liquidated. During the hour from 3 p.m. yesterday, it was only around 45,000 U. With millions of U in volume, so little forced closing suggests the decline is mainly due to people actively selling, not panic selling.
Open interest is even more worth noting. It was around 930,000 contracts at midnight yesterday and is now around 1.24 million. The price has halved, but the number of contracts is up by 30%. During the hour-long drop at 10 a.m. today, open interest rose from around 1.06 million contracts to 1.18 million, then climbed to 1.26 million by 11 a.m. Meanwhile, the funding rate has fallen to around -0.2%, meaning shorts are paying. Yet the account long/short ratio has stayed between 1.4 and 1.6, so there are still more long accounts. My interpretation is that big money is adding shorts lower down while retail traders keep buying the dip—both sides are increasing their positions.
So my view has two parts. First, the downtrend still looks unfinished. Each of the three sell-offs made a lower low, and the bounces in between never reclaimed the previous trading range. I’m not treating this as a bottom yet. Second, shorts are already very crowded. With funding this negative, a sharp rebound could come quickly. The move from 0.0091 to 0.0104 between noon and 1 p.m. today was one such rebound, but that doesn’t mean the trend has reversed.
What would prove me wrong: a high-volume recovery above 0.0115—the upper edge of the range that held overnight before the 10 a.m. sell-off—along with falling open interest and funding returning toward zero. That would suggest shorts are closing, invalidating my bearish view for this move.
Looking back at $MAGMA from this morning: I said the volume spike at 8 a.m. without a change in open interest wasn’t a trend signal, and that I’d be wrong only if volume exceeded 0.47 and open interest increased. The price later peaked at 0.4677, never clearing 0.47, and is now around 0.449. So that call hasn’t been disproven for now.
This is only an observation of market action and is not investment advice.
Gate perpetuals are now around 0.00938, down about 29% over 24 hours, with a range of 0.00844 to 0.01316 and roughly 17 million U in volume. Bitcoin is basically flat around 77,800. That’s its own story. I couldn’t find any news that clearly lines up with this, so I’m only discussing the price action below.
The three drops:
From 1 to 2 a.m. yesterday, about 4.8 million U traded over two hours, driving the price from 0.0189 to 0.01346.
From 3 to 4 p.m. yesterday, about 8 million U traded over two hours, pushing the price down from around 0.0132 to 0.0092. This was the highest-volume stretch of the past two days.
At 10 a.m. today, about 3.39 million U traded in one hour, driving the price from 0.0114 down to 0.00844, a new low.
All three drops have one thing in common: very few longs were liquidated. During the hour from 10 a.m. today, only about 22,000 U of longs were liquidated. During the hour from 3 p.m. yesterday, it was only around 45,000 U. With millions of U in volume, so little forced closing suggests the decline is mainly due to people actively selling, not panic selling.
Open interest is even more worth noting. It was around 930,000 contracts at midnight yesterday and is now around 1.24 million. The price has halved, but the number of contracts is up by 30%. During the hour-long drop at 10 a.m. today, open interest rose from around 1.06 million contracts to 1.18 million, then climbed to 1.26 million by 11 a.m. Meanwhile, the funding rate has fallen to around -0.2%, meaning shorts are paying. Yet the account long/short ratio has stayed between 1.4 and 1.6, so there are still more long accounts. My interpretation is that big money is adding shorts lower down while retail traders keep buying the dip—both sides are increasing their positions.
So my view has two parts. First, the downtrend still looks unfinished. Each of the three sell-offs made a lower low, and the bounces in between never reclaimed the previous trading range. I’m not treating this as a bottom yet. Second, shorts are already very crowded. With funding this negative, a sharp rebound could come quickly. The move from 0.0091 to 0.0104 between noon and 1 p.m. today was one such rebound, but that doesn’t mean the trend has reversed.
What would prove me wrong: a high-volume recovery above 0.0115—the upper edge of the range that held overnight before the 10 a.m. sell-off—along with falling open interest and funding returning toward zero. That would suggest shorts are closing, invalidating my bearish view for this move.
Looking back at $MAGMA from this morning: I said the volume spike at 8 a.m. without a change in open interest wasn’t a trend signal, and that I’d be wrong only if volume exceeded 0.47 and open interest increased. The price later peaked at 0.4677, never clearing 0.47, and is now around 0.449. So that call hasn’t been disproven for now.
This is only an observation of market action and is not investment advice.