Short squeeze events can occur when bearish cryptocurrency investors dominate the market and open short positions, creating high upside liquidity. As these short positions are liquidated, the price of the relevant asset increases. This triggers more liquidations at each stage. Crypto expert Vinicius Barbosa looks at 2 altcoin projects with a high probability of ‘short squeeze’ from CoinGlass data.
Data gives a ‘short squeeze’ signal for 2 altcoins!
cryptokoin.comAs you follow from , the leading cryptocurrency started the week with a decline. Bitcoin (BTC), in particular, experienced a ‘short squeeze’ at the beginning of this week. That’s why $42,000 still remains a target. However, the change in sentiment favored long positions. Therefore, it is possible that this will also lead to a retreat. BTC was trading at $41,100 at the time of writing.
In this context, most other cryptocurrencies followed the leading coin in a smaller ‘short squeeze’. Thus, it cleared liquidity pools upward. CoinGlass’ latest derivative and Open Interest (OI) data helps in this regard. There is a high short squeeze potential especially for Curve DAO (CRV) and Ripple (XRP). It is possible that this will increase altcoin prices.
‘Short squeeze’ warning for Curve (CRV): Altcoin may skyrocket!
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 relatively high compared to the cryptocurrency market, is also noteworthy. This means there are $68.26 million of open contracts shorting or longing CRV’s market cap of $502.39 million.
As for liquidity targets, CRV has many smaller liquidity pools between $0.47 and $0.55. Therefore, Curve has the potential to skyrocket for gains of over 17% through this short squeeze.
XRP (XRP) is likely to see short liquidations
Other developments regarding the SEC and Ripple case are affecting investors’ confidence. These developments continue to directly affect altcoin price movement. Interestingly, this uncertainty is reflected in the low speculative volume and open interest compared to the token’s capitalization. XRP currently has an OI/Market cap ratio of 0.018. Therefore, we should not expect big price movements in the market.
However, XRP is one of the only cryptocurrencies with short squeeze potential, aside from CRV rising to $0.55 and Bitcoin rising to $42,000. The altcoin has intense liquidity just above the current price on the weekly timeframe. XRP was trading at $0.522 at the time of writing. Potential liquidations remain at $0.525. After that, any smaller remaining open interest could pull prices into the $0.54 or $0.56 regions.
Still, the cryptocurrency market is unpredictable and liquidity can easily change following news and narratives. In this market, anything can change in the blink of an eye. Therefore, it would be beneficial for investors to be cautious and follow the markets closely.
The opinions and predictions in the article belong to the expert and are definitely not investment advice. cryptokoin.com We strongly recommend that you do your own research before investing.
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