Bitcoin is changing hands around $62,102.80 and has been up by 0.18 percent for the day. This particular move is modest in the face of the swing that has brought it to this point. The price of this largest cryptocurrency has moved up from a low in the area of $59,800 to the level of $62,270. This makes it a real four percent gain for an asset that has simply spent two weeks in the compression phase.
Considering the RSI, RSI14 is currently hovering at 43.71, which is on the neutral side. The MACD histogram was positive at 204.42 and this is the first time since the June selloff that we have witnessed some clear positive momentum. But that does not account for the recent bounce but the open interest explains that more clearly.
Price maintained its trend whereas the open interest stays flat
At the time of writing, the total open interest of Binance, Bybit, OKX, Deribit, and Hyperliquid fluctuated around the $17.42 billion level throughout the entire 24 hours of the chart above. It’s a relatively stable line with Binance contributing approximately $7.5 billion and Bybit another $7.5 billion. For the rest of the values, it was split between the other exchanges like OKX, Deribit, and Hyperliquid.
This four percent rally coupled with a flat open interest is stating that it is the shorts covering rather than fresh longs coming into the market. The capital came into the move based on the market moving higher. The thing to note here is that it is not with the leverage base. The aforementioned is a short covering bounce instead of a true conviction trade. The market bulls put pressure on a very overcrowded short book at $59,800 and ran out of momentum at $62,300.
These points have implications for future action. Cover-based rally generally tends to be of short-lived duration. It is effective till shorts that seem to liquidate have been fully liquidated and then it needs fresh demand. A subsequent couple of sessions would likely reveal the case for this largest cryptocurrency.
Most of the Open Interest is made up of Binance and Bybit, roughly equivalent to $15 billion out of $17.42 billion, and neither of them decreased in value during the bounce. Covering on many exchanges instead of just one signifies a short position being closed on a wide base rather than just a concentrated one. Volume also supports the same.
In 24 hours, Spot volume stood at close to $29.67 billion, and that number is nothing to focus on relative to the magnitude of the increase. This move did not occur in terms of volume; in a breakout, volume leads.
The next leg is defined by these three levels
Bitcoin has continued to face three resistance levels above the current levels, which are $63,319.60, $70,571.60, and $79,456.90. The first mentioned level is what matters at this point. The first level is aligning with the three separate signals at once, the old support from June with the daily pivot at $61,045.17. The important fibonacci retracement of 38.2 percent stands at $63,714.66. The first is the overlap that is more of a quick fake-out and usually draws a real test.
A reclaim of $63,319.60 opens up a quick push towards $65,000 given that not much supply rests between the levels. Above that, $70,571.6 becomes a harder roof given that it rests inside the range that June’s failed rally topped off at. Conversely, a break under $63,319.60 causes the price to retest $59,800 with a clean breakdown just below that, then unlocking the low $58,000’s range.
