Something i want to cover is
Open interest is the total amount of futures positions that are still open in the market. It is not the same as volume.
Volume tells us how much has traded over a period of time.
Open interest tells us how much positioning is still sitting in the market.
So when we say something is “open interest weighted”, it means the data is not treating every exchange equally. It is giving more importance to the exchanges or contracts where the most open interest exists.
The basic equation looks like this:
Open Interest Weight = Exchange Open Interest ÷ Total Open Interest
Then:
Open Interest Weighted Value = Sum of each exchange’s value × its open interest weight
So, in simple English:
If Binance has 50% of the total open interest, Binance gets 50% of the influence in the calculation.
If Bybit has 30% of the total open interest, Bybit gets 30% of the influence.
If OKX has 20% of the total open interest, OKX gets 20% of the influence.
That matters because a small exchange with low open interest should not move the final reading as much as a major exchange where billions of dollars of positions are actually open.
This is useful because it helps us understand where the real leveraged positioning is happening.
A normal volume reading tells us how much traded.
An open interest weighted reading tells us how important that trading is relative to the amount of open positions in the market.
That is why I care about it.
If volume is rising on an exchange with very little open interest, it may not matter much.
But if volume rises while open interest is also large, that becomes much more important because it suggests serious positioning is happening in a part of the market that actually has weight behind it.
The key thing to remember is this:
Open interest weighted data does not automatically tell you bullish or bearish.
It tells you where the important activity is.
To work out direction, you still need to compare it against price action, funding rates, spot volume, liquidations, and whether open interest is rising or falling.
That is how you turn the number into actual market analysis.
Open interest is the total amount of futures positions that are still open in the market. It is not the same as volume.
Volume tells us how much has traded over a period of time.
Open interest tells us how much positioning is still sitting in the market.
So when we say something is “open interest weighted”, it means the data is not treating every exchange equally. It is giving more importance to the exchanges or contracts where the most open interest exists.
The basic equation looks like this:
Open Interest Weight = Exchange Open Interest ÷ Total Open Interest
Then:
Open Interest Weighted Value = Sum of each exchange’s value × its open interest weight
So, in simple English:
If Binance has 50% of the total open interest, Binance gets 50% of the influence in the calculation.
If Bybit has 30% of the total open interest, Bybit gets 30% of the influence.
If OKX has 20% of the total open interest, OKX gets 20% of the influence.
That matters because a small exchange with low open interest should not move the final reading as much as a major exchange where billions of dollars of positions are actually open.
This is useful because it helps us understand where the real leveraged positioning is happening.
A normal volume reading tells us how much traded.
An open interest weighted reading tells us how important that trading is relative to the amount of open positions in the market.
That is why I care about it.
If volume is rising on an exchange with very little open interest, it may not matter much.
But if volume rises while open interest is also large, that becomes much more important because it suggests serious positioning is happening in a part of the market that actually has weight behind it.
The key thing to remember is this:
Open interest weighted data does not automatically tell you bullish or bearish.
It tells you where the important activity is.
To work out direction, you still need to compare it against price action, funding rates, spot volume, liquidations, and whether open interest is rising or falling.
That is how you turn the number into actual market analysis.
🔥5❤3🙏3👏2
I CLOSED 50%
Not chancing it with the CME gap potentially closing here. It looks like price has some momentum, so this may give us a cleaner opportunity to re-short in the morning.
Could be the wrong decision but its the sensible one
Not chancing it with the CME gap potentially closing here. It looks like price has some momentum, so this may give us a cleaner opportunity to re-short in the morning.
Could be the wrong decision but its the sensible one
👍38🔥5👏5
I’m now 14 hours without power in Thailand, so I can’t access my computer or make any proper chart analysis.
Yay Thailand problems 😂
Market-wise, things are broadly doing what I expected. The position is still sitting at around $9 million short, and I’ve got an interesting decision to make from here.
Do I increase the short back towards $15 million, or do I fully scale out this morning and look for a fresh re-entry on the next setup?
Right now, because I can’t properly see the chart, I’m leaning more towards scaling out fully and then reopening a cleaner position once I’ve got access to all the information again.
But I’m not making that decision blind.
Until my computer is back online and I can properly review the chart, liquidity, OI, funding, and the key levels, I’m just going to wait.
Annoying situation, but no need to force a trade when I don’t have the full setup in front of me.
Yay Thailand problems 😂
Market-wise, things are broadly doing what I expected. The position is still sitting at around $9 million short, and I’ve got an interesting decision to make from here.
Do I increase the short back towards $15 million, or do I fully scale out this morning and look for a fresh re-entry on the next setup?
Right now, because I can’t properly see the chart, I’m leaning more towards scaling out fully and then reopening a cleaner position once I’ve got access to all the information again.
But I’m not making that decision blind.
Until my computer is back online and I can properly review the chart, liquidity, OI, funding, and the key levels, I’m just going to wait.
Annoying situation, but no need to force a trade when I don’t have the full setup in front of me.
👍9❤8😱4🔥3⚡1
Starting today’s Analysis with Bitcoin funding rates.
Looking at the current Bitcoin funding data, we can see that funding is starting to move back above neutral across the board.
That tells us one important thing straight away: short-side pressure is beginning to cool off.
It does not mean the market is suddenly bullish, but it does mean the aggressive short positioning that helped push price down is no longer increasing with the same intensity.
That is important because when funding starts resetting back towards neutral, it can reduce the immediate downside pressure and increase the risk of a bounce.
I’ll show you why this is happening with the next chart.
Looking at the current Bitcoin funding data, we can see that funding is starting to move back above neutral across the board.
That tells us one important thing straight away: short-side pressure is beginning to cool off.
It does not mean the market is suddenly bullish, but it does mean the aggressive short positioning that helped push price down is no longer increasing with the same intensity.
That is important because when funding starts resetting back towards neutral, it can reduce the immediate downside pressure and increase the risk of a bounce.
I’ll show you why this is happening with the next chart.
🔥9❤2
Looking at the current Bitcoin chart, price is sitting around $76,969.
Right now, Bitcoin is retesting the outer support level of this range. This is a very important area.
If we lose this support, things can get ugly very quickly. A breakdown from here could open the door to a much sharper move lower, potentially another $10,000 downside move if the structure fully gives way.
That would also fit with the Wyckoff accumulation pattern I’ve marked out on the chart. Look at the blue line. That part of the Wyckoff structure is actually lining up very well.
If Bitcoin starts breaking down from here, the move into the low $70,000s, and potentially even the $60,000s, could happen aggressively.
But we are not there yet.
Bitcoin is currently sitting on multiple layers of support in this range. I have not plotted every single one on the chart, but you can see there is still support beneath price that could produce a bounce.
And honestly, my current bias this morning is that we may actually push back up first.
I am seriously considering whether this is an area to take profit on the short, or even potentially look for a short-term long.
Based on the current chart structure, I can see a $1,000 to $2,000 bounce coming at some point today or tomorrow.
That is why I am considering closing the short and locking in the profit. If I closed here, that would leave me with around $800,000 realised profit.
I am not fully there mentally yet, because there are still a few more things I would ideally like to see first.
But I also do not know if waiting is worth the risk.
To be completely honest, if I did not have to film a video right now, I probably would have already closed the trade.
Right now, Bitcoin is retesting the outer support level of this range. This is a very important area.
If we lose this support, things can get ugly very quickly. A breakdown from here could open the door to a much sharper move lower, potentially another $10,000 downside move if the structure fully gives way.
That would also fit with the Wyckoff accumulation pattern I’ve marked out on the chart. Look at the blue line. That part of the Wyckoff structure is actually lining up very well.
If Bitcoin starts breaking down from here, the move into the low $70,000s, and potentially even the $60,000s, could happen aggressively.
But we are not there yet.
Bitcoin is currently sitting on multiple layers of support in this range. I have not plotted every single one on the chart, but you can see there is still support beneath price that could produce a bounce.
And honestly, my current bias this morning is that we may actually push back up first.
I am seriously considering whether this is an area to take profit on the short, or even potentially look for a short-term long.
Based on the current chart structure, I can see a $1,000 to $2,000 bounce coming at some point today or tomorrow.
That is why I am considering closing the short and locking in the profit. If I closed here, that would leave me with around $800,000 realised profit.
I am not fully there mentally yet, because there are still a few more things I would ideally like to see first.
But I also do not know if waiting is worth the risk.
To be completely honest, if I did not have to film a video right now, I probably would have already closed the trade.
❤1
This is the dilemma.
There are still charts like this one suggesting more downside, but this is where we have to separate short-term, mid-term, and long-term analysis.
Different timeframes tell us different things.
On this timeframe, the signal is still clearly pointing lower. Historically, when this chart is green, price tends to go down. When it flips red, price tends to recover.
Right now, my concern is that it looks like we may be starting to loop back towards red, which would suggest the downside momentum is cooling off and a bounce could be coming.
But trend is your friend.
At the moment, the trend is still green, and on this chart, green means downside.
So while I can see the argument for taking profit and expecting a short-term bounce, the broader signal has not fully flipped yet.
That is what makes the decision difficult.
There are still charts like this one suggesting more downside, but this is where we have to separate short-term, mid-term, and long-term analysis.
Different timeframes tell us different things.
On this timeframe, the signal is still clearly pointing lower. Historically, when this chart is green, price tends to go down. When it flips red, price tends to recover.
Right now, my concern is that it looks like we may be starting to loop back towards red, which would suggest the downside momentum is cooling off and a bounce could be coming.
But trend is your friend.
At the moment, the trend is still green, and on this chart, green means downside.
So while I can see the argument for taking profit and expecting a short-term bounce, the broader signal has not fully flipped yet.
That is what makes the decision difficult.
👍5
Now let’s analyse Bitcoin spot volumes and see what useful information we can pull from the data.
First things first, the large chart with the yellow bars represents Bitcoin spot volume.
On the one-hour chart, we can see a clear volume spike when Bitcoin moved from around $77,000 down towards $76,000.
So the obvious question is: when volume spikes like that, is it buying or selling?
Recently, every time Bitcoin has seen an aggressive move lower, we have also seen a spike in spot volume. But the important part is what happens afterwards.
Those volume spikes have not been followed by strong upside reversals.
They have been followed by more downside.
In other words, each sell-off is being met by another sell-off, not by aggressive spot buying.
That tells us something important: very few people are actively buying spot Bitcoin here.
The volume that is coming into the spot market appears to be mostly selling pressure. Yes, that selling is hitting an order book, but as price moves lower, the order book starts to look weaker because spot demand is not materially increasing.
Looking at the Bitcoin volume overview for the day, Bitcoin spot volume is only up around 5.68%.
Bitcoin futures volume, meanwhile, is up around 17.84%.
That is a big difference.
A 17.84% increase in futures volume shows traders are still actively participating with leverage.
But only a 5.68% rise in spot volume tells me that buyers are not particularly interested in accumulating spot Bitcoin at these prices.
That creates a real issue when deciding whether to exit a short position.
If nobody seems to care about buying the underlying asset, then why would you rush to close the short?
That is the difficult question.
I am currently around $9 million short, and based on this data alone, the argument for staying short is actually getting stronger, not weaker.
Over the past four hours, Bitcoin spot volume has dropped around 50% since that big spike.
So the market has already started drying up again.
That means the sell-off was not met with some strong, aggressive effort to restore price. Normally, when a CME gap is sitting above, you might expect a stronger bounce attempt. So far, we are not really seeing that.
To be fair, it is still early in the session, so we cannot be too rigid. But as we go through today’s analysis, the data is starting to challenge my initial thought that I should maybe close and expect a bounce.
Instead, the data is starting to suggest that holding the short may actually be the better decision.
That is why we have to stay agile.
We can only read the data in front of us. We can only read the money.
The other important point here is the taker buy versus taker sell data on Bitcoin spot volume over the past 24 hours.
Bitcoin taker buy volume is currently around 48.42%.
Bitcoin taker sell volume is around 51.58%.
That means spot selling pressure is still outweighing spot buying pressure.
And compared with the futures side, there is proportionally more sell pressure showing up in the spot market.
That is important because if spot selling is heavier than futures selling, then the structure becomes very attractive for large players.
In theory, a large player can dump spot Bitcoin while also opening large short positions into that weakness.
That creates a strong incentive for major holders, ETF-related desks, or large institutions to profit from downside pressure while the rest of the market sits there expecting a bounce that may never arrive.
I am not saying that is definitely what is happening.
But the incentive is clearly there.
If spot demand is weak, futures volume is rising, taker sell volume is dominating, and each volume spike is being followed by more downside instead of recovery, then the market is still behaving like a sell-side market.
So as much as I was considering taking profit earlier, this spot volume data is not giving me a strong reason to close the short yet.
If anything, it is making the case for holding stronger.
First things first, the large chart with the yellow bars represents Bitcoin spot volume.
On the one-hour chart, we can see a clear volume spike when Bitcoin moved from around $77,000 down towards $76,000.
So the obvious question is: when volume spikes like that, is it buying or selling?
Recently, every time Bitcoin has seen an aggressive move lower, we have also seen a spike in spot volume. But the important part is what happens afterwards.
Those volume spikes have not been followed by strong upside reversals.
They have been followed by more downside.
In other words, each sell-off is being met by another sell-off, not by aggressive spot buying.
That tells us something important: very few people are actively buying spot Bitcoin here.
The volume that is coming into the spot market appears to be mostly selling pressure. Yes, that selling is hitting an order book, but as price moves lower, the order book starts to look weaker because spot demand is not materially increasing.
Looking at the Bitcoin volume overview for the day, Bitcoin spot volume is only up around 5.68%.
Bitcoin futures volume, meanwhile, is up around 17.84%.
That is a big difference.
A 17.84% increase in futures volume shows traders are still actively participating with leverage.
But only a 5.68% rise in spot volume tells me that buyers are not particularly interested in accumulating spot Bitcoin at these prices.
That creates a real issue when deciding whether to exit a short position.
If nobody seems to care about buying the underlying asset, then why would you rush to close the short?
That is the difficult question.
I am currently around $9 million short, and based on this data alone, the argument for staying short is actually getting stronger, not weaker.
Over the past four hours, Bitcoin spot volume has dropped around 50% since that big spike.
So the market has already started drying up again.
That means the sell-off was not met with some strong, aggressive effort to restore price. Normally, when a CME gap is sitting above, you might expect a stronger bounce attempt. So far, we are not really seeing that.
To be fair, it is still early in the session, so we cannot be too rigid. But as we go through today’s analysis, the data is starting to challenge my initial thought that I should maybe close and expect a bounce.
Instead, the data is starting to suggest that holding the short may actually be the better decision.
That is why we have to stay agile.
We can only read the data in front of us. We can only read the money.
The other important point here is the taker buy versus taker sell data on Bitcoin spot volume over the past 24 hours.
Bitcoin taker buy volume is currently around 48.42%.
Bitcoin taker sell volume is around 51.58%.
That means spot selling pressure is still outweighing spot buying pressure.
And compared with the futures side, there is proportionally more sell pressure showing up in the spot market.
That is important because if spot selling is heavier than futures selling, then the structure becomes very attractive for large players.
In theory, a large player can dump spot Bitcoin while also opening large short positions into that weakness.
That creates a strong incentive for major holders, ETF-related desks, or large institutions to profit from downside pressure while the rest of the market sits there expecting a bounce that may never arrive.
I am not saying that is definitely what is happening.
But the incentive is clearly there.
If spot demand is weak, futures volume is rising, taker sell volume is dominating, and each volume spike is being followed by more downside instead of recovery, then the market is still behaving like a sell-side market.
So as much as I was considering taking profit earlier, this spot volume data is not giving me a strong reason to close the short yet.
If anything, it is making the case for holding stronger.
👍11
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Now let’s move on to the Bitcoin liquidation heat map and Bitcoin open interest.
I’m putting these two together because they are giving slightly different signals, and that is exactly why this is an interesting decision point.
Starting with the 24-hour Bitcoin liquidation heat map, we can see Bitcoin is currently trapped between roughly $77,300 and $76,500.
A break of either side likely sends price into the next liquidity zone.
The level that still looks very attractive is down around $76,000. That is the level we have been watching all weekend, and it is still very much in play.
So the setup could be this:
Bitcoin pushes down towards $76,000, grabs that liquidity, makes a slightly higher low, and then starts moving back up towards the $80,000s, potentially even towards $85,000 if the recovery structure develops properly.
That is still generally my bias.
I do think we are getting closer to the end of this downside move. Not much has changed that view. I still think the market is probably setting up for upside soon.
The question is whether there is one more move lower first.
This is why I’m trying to work out whether now is the correct time to exit the short, or whether there is still a little more downside to capture.
The liquidation heat map is suggesting the market may still be initially bearish, because there is attractive liquidity below. But after that liquidity is taken, the structure could turn much more bullish.
Then we move over to Bitcoin open interest.
Open interest did drop heavily during the initial move down, but if you look closely at the chart, the major OI drop happened first. After that, price continued moving lower while open interest started rising again.
That tells us one of two things.
If open interest is rising while price is falling, it could mean new short positions are entering the market and pressuring price lower.
But it could also mean traders are taking long exposure after the dump.
The problem is that open interest alone does not tell us whether the money entering the market is long or short.
So to get a better read, we need to look at the Bitcoin long-short ratio.
Over the past 24 hours, the market is still slightly short-heavy:
Longs: $23.14 billion
Shorts: $23.66 billion
But the crash happened mainly within the past few hours, so the shorter-term data matters more here.
Over the past four hours, we have:
Longs: $4.72 billion
Shorts: $4.33 billion
That is a meaningful shift.
It suggests that during the recent move, traders have started leaning back towards longs, or that shorts are taking profit and closing into the drop.
That makes this decision more complicated.
On one hand, the downside liquidity still looks attractive. A move into the $76,000 region would make complete sense.
On the other hand, the long-short data is starting to tell me that the market may be preparing for a bounce.
So this brings me back to the sensible decision: maybe it is time to start thinking seriously about closing the short, locking in profit, and not overstaying the trade.
We are definitely in a more questionable area of the market now.
The downside is still attractive, but the risk of a bounce is increasing.
I’m putting these two together because they are giving slightly different signals, and that is exactly why this is an interesting decision point.
Starting with the 24-hour Bitcoin liquidation heat map, we can see Bitcoin is currently trapped between roughly $77,300 and $76,500.
A break of either side likely sends price into the next liquidity zone.
The level that still looks very attractive is down around $76,000. That is the level we have been watching all weekend, and it is still very much in play.
So the setup could be this:
Bitcoin pushes down towards $76,000, grabs that liquidity, makes a slightly higher low, and then starts moving back up towards the $80,000s, potentially even towards $85,000 if the recovery structure develops properly.
That is still generally my bias.
I do think we are getting closer to the end of this downside move. Not much has changed that view. I still think the market is probably setting up for upside soon.
The question is whether there is one more move lower first.
This is why I’m trying to work out whether now is the correct time to exit the short, or whether there is still a little more downside to capture.
The liquidation heat map is suggesting the market may still be initially bearish, because there is attractive liquidity below. But after that liquidity is taken, the structure could turn much more bullish.
Then we move over to Bitcoin open interest.
Open interest did drop heavily during the initial move down, but if you look closely at the chart, the major OI drop happened first. After that, price continued moving lower while open interest started rising again.
That tells us one of two things.
If open interest is rising while price is falling, it could mean new short positions are entering the market and pressuring price lower.
But it could also mean traders are taking long exposure after the dump.
The problem is that open interest alone does not tell us whether the money entering the market is long or short.
So to get a better read, we need to look at the Bitcoin long-short ratio.
Over the past 24 hours, the market is still slightly short-heavy:
Longs: $23.14 billion
Shorts: $23.66 billion
But the crash happened mainly within the past few hours, so the shorter-term data matters more here.
Over the past four hours, we have:
Longs: $4.72 billion
Shorts: $4.33 billion
That is a meaningful shift.
It suggests that during the recent move, traders have started leaning back towards longs, or that shorts are taking profit and closing into the drop.
That makes this decision more complicated.
On one hand, the downside liquidity still looks attractive. A move into the $76,000 region would make complete sense.
On the other hand, the long-short data is starting to tell me that the market may be preparing for a bounce.
So this brings me back to the sensible decision: maybe it is time to start thinking seriously about closing the short, locking in profit, and not overstaying the trade.
We are definitely in a more questionable area of the market now.
The downside is still attractive, but the risk of a bounce is increasing.
❤3👍3