A Crypto Analyst Debunks Predictions of Bitcoin Crash to $20,000
A well-known crypto strategist has shared his thoughts on the possibility of Bitcoin (BTC) experiencing a significant downward movement while still trading above $28,000. Credible Crypto, an analyst with a large following, believes that it is highly unlikely for BTC to drop to $20,000 based on the current level of open interest (OI). OI refers to the total number of active derivative contracts held by traders.
According to Credible Crypto, historical data shows that the aggregate OI at around $6 billion has acted as a bottom in the past year. Additionally, $11 billion has proven to be a local top. Although a major flush in August caused the OI to drop from $11 billion to under $8 billion, it failed to break the previous low at $24,800. Currently, the aggregate OI stands at around $8.5 billion, which is 50% less than what it was in August.
Credible Crypto also argues that it is unlikely for BTC to dip below $24,800 due to the reduced amount of liquidation-prone leveraged positions in the system compared to August. Therefore, betting on a break of this level would go against the odds.
As of now, BTC is valued at $28,698.
Hot Take: Bitcoin Crash Unlikely Based on Open Interest Analysis
A prominent crypto analyst has dismissed predictions of a Bitcoin crash to $20,000. Credible Crypto argues that the current level of open interest (OI) in the market makes this scenario highly improbable. Historical data suggests that $6 billion acts as a bottom for OI, while $11 billion represents a local top. Despite a major flush in August, which reduced OI from $11 billion to under $8 billion, BTC remained above its previous low at $24,800. The analyst points out that the current aggregate OI of around $8.5 billion is 50% lower than in August, making a dip below $24,800 unlikely. Therefore, betting on such a move would be against the odds.
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