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Analysis: Bitcoin rebounded, but spot trading volume shrank rapidly, and the risk of a squeeze on long positions in derivatives is accumulating.
According to BlockBeats, on July 6th, crypto analyst Murphy pointed out that during Bitcoin's rebound from $58,000 to nearly $64,000, spot trading volume declined rapidly. A rebound lacking support from spot demand is unlikely to form a trend reversal and is often just a sentiment-driven correction; the sustainability of the rebound needs to be monitored. On the positive side, the USDC/USDT exchange rate fell from 1.001 to 1.0006, indicating a weakening of exit intentions and a recovery in trading intentions. While major stablecoins on trading platforms are still experiencing net outflows, the outflow rate continues to narrow, and the marginal improvement in funding pressure supports the continuation of the rebound.
However, the weakening of spot driving force means a relative increase in the weight of derivatives. The 7-day average of the perpetual contract long premium has continued to rise to $160,000/hour, indicating that Taker buying continues to push perpetual prices above spot prices; although open interest has decreased, it is still significantly higher than the level in February of this year. The current long premium is still within the normal range, but as the rebound continues, the risk of long squeeze will continue to accumulate. Once the open interest rebounds again, the fierce battle between long and short positions will make the volatility come faster and more rapidly. This is a hidden danger that needs to be paid attention to in advance.
Disclaimer: The views above are the author's only and do not represent 711BTC. Nothing here constitutes investment advice.
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