BNB open interest stood at $594 million at the close of May 31. But since CZ’s prison term began, speculative traders have piled on an unsually high volume of new capital inflows.
At the time writing on June 5, BNB open interests has reach $1.01 billion, reflecting a whopping $405 million surge
Notably, this also shows that while BNB price has only declined 21.28% in the last 5-days, the open interest has recorded a more significant 68% increase.
When open interest faster than the price uptick during a rally, strategic investors consider it an early signal that the market trend in nearing the top.
This faster uptick in Open Interest suggests that the BNB price rally this week has been majorly driven by the activities of speculative traders, rather than organic spot purchases.
More importantly, this outsized $1.01 billion speculative futures contracts heightens the risk of massive liquidations and rapid price downswings when BNB traders begin to book profits.
BNB Price Forecast: Bulls Risk $600 Correction
BNB price is trading at all-time highs above $700 at the time of writing on June 5. But the $405 million surge in the speculative contracts suggests a profit-taking wave could lead to rapid downswings towards $600 in the near-term.
However, the upper-limit Bollinger band technical indicator highlights the $670 price level as the critical short-term support cluster to watch in the days ahead.
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