Bitcoin Longs Face Squeeze as Price Drops Towards August Lows
The Bitcoin market is showing signs of volatility as it heads towards new August lows. According to an analysis by CryptoQuant, long positions on Binance are facing liquidation due to a decline in price and open interest (OI). The correlation between price and OI has reached 0.25, indicating that leveraged long positions are being flushed out.
The analysis focuses on the relationship between price and OI on Binance. While price has traded in a narrow range since June, CryptoQuant data show that Binance OI has gradually increased, reaching $8.15 billion on Wednesday. This increase in OI suggests that futures are increasingly steering the market while spot traders sit on the sidelines.
CryptoQuant CEO Ki Young Ju also weighed in on the market, stating that 'the stars haven't aligned' for a renewed Bitcoin bull market. He noted that conditions for a bull run have yet to emerge, and several composite onchain indicators are still in bear territory.