📊 Divergence Between Binance Open Interest% and Bitcoin Price:
* A notable divergence has emerged on Binance between Bitcoin’s price action and its 24-hour Open Interest percentage change.
* While BTC price recently formed a lower low, dipping below $113K, the Open Interest % has instead formed a higher low — a classic bullish divergence signal.
* This divergence suggests that although price action continued to decline, the rate of Open Interest reduction slowed down.
* This pattern often reflects a capitulation phase, where traders are closing positions but with diminishing intensity.
* In this case, the divergence was likely fueled by a two-phase Open Interest liquidation:
- First wave: occurred after BTC touched $113K, triggering a round of long liquidations.
- Second wave: came shortly after, with price pushing slightly below $112,5K, likely triggering stop-losses or further forced long closures.
* Such a sequential unwinding of positions at varying intensity can generate this kind of structural divergence, which is often interpreted as a cooling-off phase before a potential reversal.
⚖️ Price Gap Between Spot and Derivatives Markets on Binance:
* Another significant signal is visible in the Spot vs. Perpetual Price Delta chart for Binance.
* The spot price is currently trading at a discount compared to the perpetual (derivatives) price — indicating a negative basis.
This negative spread is commonly caused by:
- Falling OI, which reduces the liquidity and depth of the derivatives market.
- Persistent longs closures, which lower demand for perpetual contracts and reduce funding rates.
* In normal healthy markets, we often see Contango — a situation where fut/perp prices trade above the spot price, driven by optimism and a willingness to pay a premium for future exposure.
* However, the current inverse Contango setup (spot < perp) reveals a shift toward risk-off sentiment, where traders reduce exposure and avoid paying additional premiums.
Written by Amr Taha
