The crypto market underwent a massive correction on Sunday and Monday, but it’s not all bad news, according to a popular digital asset analyst.
The pseudonymous trader known as Credible Crypto tells his 407,400 followers on social media platform keeps track.
“Nature heals. Note that the bottom dotted green line is the lowest recorded OI we’ve seen in this entire range and the closer we get to that level, the healthier it is.
That said, OI can be wiped out on moves down (long liquidations) AND on moves up (short liquidations), so we don’t necessarily need to completely ‘reset’ OI before hitting our bottom in terms of price.
Let’s continue to see how things develop, but this sweep in OI is great to see.”
The disappearance of open interest is usually a bullish signal for assets in an uptrend, as it indicates that excessive debt has been flushed from the market.
BTC is trading at $55,888 at the time of writing and is up over 3% in the last 24 hours.
Credible too argues that the market correction is “just a temporary downturn” that does not change its medium- or long-term prospects.
“The coins that were the strongest in the past 24 hours prior to this drop are also likely to recover the fastest. The currencies that were weakest before this decline are likely to struggle.
This is not the time to sell, but to take advantage of discounts on the strong coins we identified earlier, because when the reversal happens, they must take the lead.”
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Generated image: Midjourney