Bitcoin Open Interest Rises, Bulls Positive of a Breakout
The $40k is proving a hard nut to crack for Bitcoin bulls. Indeed, traders are confident of more gains in the days to come. Still, first things first, $40k is a round number, a psychological level that must be resoundingly 'defeated' if $30k marks the bottom of the recent bear cycle.
It is critical.
Specifically, the zone between $40k and $42k is a crucial liquidation region marking January 2021 highs. For this reason, it is a level watched closely by traders across the board.
At present, Stack Funds observes that the number of Bitcoin positions in the derivatives market has been gathering steam despite the stubbornness of $40k.
The team says there is a marked similarity between current events in open interest-build up with what happened in late 2020. Then, traders were flocking to derivatives exchanges, leveraging, and building their positions in anticipation of more gains.
This was before prices blew expectations, expanding to over $64k in H1 2021.
Taking cues, Stack Funds says there is a high possibility of Bitcoin prices rising from spot levels to retest 2021 highs—a move that will be received ecstatically by traders across the board.
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