Key Points
- Bitcoin and Ethereum experienced a rise in long liquidation volumes due to price drops.
- Despite the declines, the lack of significant sell-offs suggests a stable market.
The last trading session saw an increase in long liquidation volumes for Bitcoin (BTC) and Ethereum (ETH) due to a drop in prices.
Market Volatility and Open Interest Declines
The two digital assets ended September on a turbulent note, with short-position traders having a significant impact on the market.
CryptoQuant data indicates a noticeable decrease in Bitcoin and Ethereum’s open interest (OI) during the last trading session.
Bitcoin’s OI dropped from $18.6 billion to $18.1 billion, suggesting that traders were closing their futures positions.
A decrease in OI usually indicates lower liquidity, volatility, and interest in derivatives trading, potentially leading to a long/short squeeze.
Ethereum’s OI also saw a slight decline, though not as significant as that of Bitcoin.
Currently, Bitcoin’s OI has rebounded to $18.3 billion, and Ethereum’s OI has risen to $9.4 billion, indicating renewed market activity.
Price Trends and Exchange Flows
The fall in open interest directly affected the prices of both Bitcoin and Ethereum.
Bitcoin saw a 3.50% decrease, falling from $65,600 to $63,301, dipping below its 200-day moving average.
Ethereum experienced a 2.13% drop, from $2,657 to $2,601, staying below its 200-day moving average but still above the 50-day moving average.
At present, both assets have shown a slight recovery, with Bitcoin trading at $63,789, a 0.7% increase, and Ethereum gaining over 1%, trading around $2,639.
Despite the recent declines, there hasn’t been a significant sell-off.
CryptoQuant data shows that Bitcoin recorded a negative exchange flow, indicating a balanced flow of BTC between exchanges and personal wallets.
Ethereum saw a slight increase in exchange inflows, with 14,000 ETH flowing into exchanges during the last trading session.
However, this volume wasn’t enough to trigger a major sell-off.
Currently, the flow has turned negative again, with over 23,000 ETH being withdrawn from exchanges, signaling reduced selling pressure.
Despite the notable declines in Bitcoin and Ethereum in the final days of September, the absence of a major sell-off and the slight price rebound suggest a relatively stable market.
Open interest trends and exchange flows indicate that investors are not rushing to exit their positions, showing potential for recovery in the near term.
