$HOT 24-hour contract open interest +22.07%, price -5.64%—open interest is rising while price is falling.
First, a note on methodology: open interest here is measured in coins, excluding the impact of price changes on position value, so increases and decreases reflect actual positions being opened or closed.
As prices fall, new positions are being opened. Most likely, new short positions are actively pushing prices down, though some longs may also be adding to their positions as prices fall. For now, watch out for continued pressure from shorts; but if short positions become too crowded, a short squeeze could happen quickly.
If the market moves in the opposite direction next, how would you respond?
First, a note on methodology: open interest here is measured in coins, excluding the impact of price changes on position value, so increases and decreases reflect actual positions being opened or closed.
As prices fall, new positions are being opened. Most likely, new short positions are actively pushing prices down, though some longs may also be adding to their positions as prices fall. For now, watch out for continued pressure from shorts; but if short positions become too crowded, a short squeeze could happen quickly.
If the market moves in the opposite direction next, how would you respond?
