Margin Trading Liquidations And Open Interest Seem To Favor A Bullish Bitcoin Spell

cryptomode trading on a stock exchange Margin Trading Liquidatons proof of reserves

The crypto market sentiment appears to be turning once again. Although there is still sufficient bearish pressure, margin traders opening shorts have a higher chance of getting liquidated for now. It would be good to see the markets rebound, although it remains too early to draw conclusions. 

Weekly Liquidations Favor Going Long

Recent statistics shared by Top 7 ICO confirm things are getting more exciting in the cryptocurrency industry. More specifically, a lot of money has been lost through margin trading liquidations this week. Nearly $920 million has been lost across OKX, Binance, ByBit, FTX, Huobi, CoinEx, BitMEX, and Deribit this week. It is interesting to see how the longs and shorts match up across these platforms.

First of all, OKX is the exchange with the most margin trading liquidations in the past week. That may seem a bit surprising, although the volume of $386.5 million is rather impressive. It is much higher than Binance’s $272 million, which is respectable. ByBit completes the top three with $117.1 million. Former margin trading giant BitMEX is not in the top five and generated just over $20.5 million, further confirming its fall from grace. 

Given the current conditions, a weekly volume of under $1 billion may seem rather low. Markets can go bearish or bullish at any moment, creating tremendous opportunities for those going long or short. However, it will require good market timing, as the losses and gains do not remain in place too long these days. It is a tricky narrative to change as the macroeconomic circumstances do not allow for much optimism. 

Moreover, the platforms see an interesting division between long and short liquidations. ByBit, for instance, has far more shorts being liquidated this week, a trend that also applies to CoinEx. All other platforms seem to have a relative balance between the two, although margin traders on Binance who went long suffered steeper losses over shorters. Overall, there seems to be a sentiment to go long – at the time of writing – although the market direction remains unclear.

Should You Get Excited?

The past week’s statistics are not necessarily indicative of the current sentiment. However, statistics by CoinGlass confirm most BTC traders are long, even if the difference is minimal. Overall positions range from 50.09% to 52.73% being bullish, with ByBit noting solid bullish momentum across BTC-USD and BTC-USDT. Deribit goes further, with 54.61% of traders having a long position, which is exceptional. 

Open interest across margin trading platforms remains virtually unchanged. Binance has over $2 billion in open interest, well ahead of FTX’s $1.16 billion. Bitget is the only other platform close to the $1 billion mark, and Kraken doesn’t even break the $30 million level. Very intriguing rankings, although it is unclear if bitcoin will have a massive breakout in the coming days. 

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