Quick Take
- A sharp increase in futures open interest occurred on Aug. 9 to a level seen just seven times this halving cycle, thus registering one of the largest single-day surges ever.
- An impressive addition of over 32,000 Bitcoin was channeled into futures open interest contracts, pushing the open interest close to the year-to-date highs.
- A sharp variation in Futures Open Interest often indicates deleveraging events and liquidation cascades and can swing both ways – long and short.
- Significant positive spikes typically signify substantial inflows of Open Interest, hinting at fresh capital venturing into the market and an upswing in leverage.
- On the other hand, large negative spikes usually emerge from short/long squeezes or liquidation cascades, which results in a massive volume of open contracts being margin called and closed.
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