Analysis: Bitcoin Rebounds But Spot Trading Volume Shrinks Rapidly, Long Squeeze Risk in Derivatives is Building Up

BlockBeats News, July 6th. Cryptocurrency analyst Murphy pointed out that during Bitcoin's rebound from $58,000 to nearly $64,000, the spot relative trading volume quickly declined. The rebound, lacking spot demand support, struggled to form the basis for a trend reversal, often being just a sentiment-repairing rally. It is necessary to pay attention to the sustainability of the rebound. On the brighter side, the USDC/USDT exchange rate fell from 1.001 to 1.0006, indicating a weakening selling pressure and a recovering trading intent. Although mainstream stablecoins on the trading platforms are still experiencing net outflows, the outflow amount is continuously narrowing. The marginal improvement in the funding pressure is providing support for the continuation of the rebound.

However, the weakening of spot market momentum implies a relative strengthening of derivative weight. The perpetual contract's long position premium 7-day moving average has continuously risen to $160,000 per hour, indicating that Taker buying pressure continues to drive the perpetual price above the spot price. Although the open interest has declined, it is still significantly higher than the level seen in February this year. The current long position premium is still within a normal range, but as the rebound continues, the risk of long squeeze will continue to accumulate. Once the open interest rebounds again, an intense long versus short game will accelerate the volatility, posing a hidden danger that needs to be anticipated in advance.