Gustavo Faria
BTC: A Look into Recent Activity and Risks
BTC has shown a 3.5% upside in the last few hours, breaking the sideways pattern that had been occurring in recent days. Looking at the network activity, we have some signals that help us identify what's driving this movement. Tracking the price action, we noticed an expansion of approximately 1 billion in Open Interest (OI), signaling an increase in the number of open positions on derivatives exchanges. The funding rates for perpetual contracts remained positive during the OI expansion, indicating the predominance of long traders and an optimistic sentiment. Overall, this setup is positive for the price. However, it becomes more unstable when we see that the estimated leverage increased considerably during the uptrend, creating a structure conducive to a long squeeze in the event of a sharp price drop. Analyzing the distribution of all spent outputs that flowed into exchanges at the beginning of the uptrend, we observed a predominance of addresses with 1k-10k BTC, accounting for 66% of the volume. The rise in the Coinbase Premium Index confirms this setup, signaling whale accumulation. Unlike other uptrends driven by the derivatives market that we've seen in recent weeks, this one seems to have more solid support in the spot market, creating a more optimistic structure. However, it's essential not to overlook risk signals: On Wednesday, September 20, the US interest rate target will be announced. This event usually brings more volatility to the market, and with the current leverage level, the risk is amplified.