cryptocurrency The development, also referred to as “short squeeze” in the market, refers to the pressure that investors who opened “short positions” regarding the decrease in the price of the asset face to close their positions after the increase in the price. As this happens, positions are liquidated and the price increases, and as the price increases, other remaining positions continue to be liquidated.
As Koinfinans.com reported, Bitcoin witnessed a similar development at the beginning of the current week. While the short-term target of $42,000 continued for investors, the preference for opened positions was “long”. This situation may increase the upward pressure and trigger a decline by giving an adverse reaction.
According to CoinGlass’ derivative and Open Interest (OI) data, similar short positions appear to have accumulated in Curve DAO (CRV) and XRP.
Could Witness a Short Squeeze Event for Curve (CRV)
curve, is trading at $0.466 with a 3.8% price increase in the last 24 hours. However, 52.74% of its 24-hour volume consists of short positions totaling $81.64 million.
The OI/Market value ratio of 0.1359, which is high compared to the cryptocurrency market, also attracts attention. This means there are $68.26 million in open contracts shortening or extending CRV’s $502.39 million market cap.
CRV has many small liquidity pools between $0.47 and $0.55. This means Curve has the potential to gain over 17% through a short squeeze.
XRP Price May Also Rise with Short Squeeze
Depending on the progress of the case filed against Ripple by the SEC XRP Investors are also looking for opportunities to renew their confidence. Although the price has been away from the desired targets for a while, it has a calmer appearance, away from speculative movements, with an OI/Market value ratio of 0.018.
Despite this rate, which is far from speculative, the probability of short squeeze continues to increase. XRP, which is trading at $0.522, will see potential liquidations around $0.525. It seems like the price may visit $0.54 and $0.56 after this level.
