Warning signal? Leverage surge, Bitcoin (BTC) long-term holders take profits.

Gate news, Bitcoin continues to maintain its upward momentum after a slight pullback, currently trading at 107,485 USD, up 2.2% over the past week. Although it is still about 4% lower than the historical high of 111,000 USD set in May, its price movement indicates a strong return of market momentum.

In recent weeks, as investor sentiment fluctuates between bullish optimism and profit-taking behavior, trading activity in the cryptocurrency market led by Bitcoin has become active again.

According to the latest on-chain data analyzed by CryptoQuant writer Amr Taha, Bitcoin may be approaching a critical phase that requires more attention from market participants.

The surge in open contracts indicates a potential profit-taking zone In his analysis titled "The Surge of Open Interest in CEX and the Risk Aversion of Long-Term Holders: Bitcoin is Approaching a Turning Point," Taha emphasizes two trends: the repeated surge of open interest in CEX and the significant reduction of exposure for long-term holders.

He believes that these two indicators reflect the market dynamics that may affect Bitcoin's short-term price movement. A key observation in Taha's analysis is the performance of the CEX 24-hour open interest (OI), which has exceeded 6% for the third time in two months.

Historical patterns indicate that after the crashes on May 26 and June 10, prices typically experience a short-term pullback or consolidation period. These surges usually signal an increase in leveraged trading positions, which often suggests that traders are taking short-term profits to lock in gains.

This trend may indicate that Bitcoin is entering another stage of increased volatility, and the rapid changes in market sentiment could affect the price movement.

The existence of leveraged positions, especially at high price levels, increases the likelihood of sudden liquidation or pullbacks. While this does not confirm an impending reversal, it marks a region that may require caution, particularly for short-term traders. This surge in open contracts is often a precursor to more conservative position allocations or a temporary cooling period in the market.

Bitcoin Long-term Holders Reduce Risk Exposure In addition to the increasing speculation activities, another trend tracked by Taha focuses on the behavior of long-term holders (LTH). Data shows that the net position of LTH has reached a cap (an indicator measuring the actual value of Bitcoin held by these investors) and has sharply declined from over $57 billion to only $3.5 billion.

This decrease indicates that more strategic investors are actively taking profits, which may be a response to macroeconomic developments or uncertainties in the current market cycle.

Although this behavioral shift does not necessarily indicate a bearish outlook, it suggests that experienced investors are reducing their positions after a significant price rise. Historically, long-term holders have demonstrated greater market foresight, making this behavior worthy of attention.

In addition to the increase in open interest and the potential calm period, these changes highlight the possibility of heightened short-term volatility, but will not fundamentally alter the long-term bullish structure of the Bitcoin market.

(Source: NewsBTC)