The Bitcoin Futures (BTC) expiry today was flawed in terms of price and volume impact. Open interest only decreased by $ 157 million and barely left the $ 5 billion mark.

As CoinTelegraph correctly predicted yesterday, the final expiration date of the CME Bitcoin futures was irrelevant. August contracts valued at $ 125 million are due to be liquidated today, although preliminary data suggests there is still less than $ 40 million to be carried forward for the coming months.

The graph above shows the total change in open positions over the past 24 hours, even though the data includes inverse (permanent) swaps and remaining calendar months.

This contrasts strikingly, however, with the late July when $ 500 million futures contracts were liquidated.

The expiration size depends on recent price activity
It seems that the main reason these traders are indifferent to today’s flow is because no support levels have been set above $ 11,200 in the past few weeks.

As CoinTelegraph reported earlier this week, “Current macro factors point to a positive price cycle in the medium to long term, but suggest that momentum will slow in the short term and a period of consolidation will occur.”

The markets have behaved very differently in the last few weeks after each futures contract expired, so the outcome for the liquidated amount was different. The end of July saw an upward trend of 26%, while the last two weeks were unchanged.

An open interest is more important than a small process
Some traders may be disappointed when Bitcoin loses its recent momentum, but that doesn’t mean professional investors are leaving the futures markets. The lack of volume or the stability of the open interest in futures means that bets have already been placed.

Investors should only worry if the open interest diminishes, as it is an indication that smart traders have reduced their exposure. This will be of particular importance in the consolidation phase.

Such a bearish scenario is not the case, as the total open interest in all exchanges more than doubled over the course of 2020. The current $ 4.9 billion mark is just $ 800 million above the August 17th all-time high.

Bitcoin appears to be closely related to gold and that’s fine
Regardless of the 30-day and 90-day correlations, the tight intraday movements between gold and bitcoin sometimes last a few days. This is especially true when major macroeconomic events like this week’s Jackson Hole dominate the scene.

Please note that the above chart has different metrics as the fluctuations will be different based on the relationship between each asset. However, the similarity in daily movements between gold and bitcoin is impressive.

This short-term correlation should not be interpreted as a sign that Bitcoin has become a global reserve asset, but rather as a reminder that cryptocurrency markets have been severely affected by the same external events that drive traditional markets.

Regarding the remaining expiry times of the futures market throughout the year, one should closely monitor the base (contango) and ratio of large to long-term traders as both of these provide insight into the sentiment of larger investors.

Source: CoinTelegraph