This wave of increase feels a bit different We know that the sudden violent pull of BTC has caused a record breaking amount of futures liquidation, but the open interest (OI) of the contract is also decreasing. OI decrease and price increase indicate that the overall position is being closed. And short stop loss or liquidation requires buying and closing positions, which also becomes the fuel to push up prices. Buying and closing positions can only eliminate existing positions and cannot create new net exposures, so for every purchase, OI decreases by one. That is to say, in this market trend, the past is being liquidated, but there is no betting on the future. Its energy limit is the total amount of short positions in the market. Once the short positions are cleared, this force disappears. If the rise is solely driven by liquidation, the typical form is insertion. Quickly pull up, then quickly fall back, leaving a long upper shadow line. After the price rose this time, it remained stable, indicating that there were other funds continuing to buy after the wave of liquidation receded, and this "other funds" came from spot goods. Additionally, there is an issue of causal order here. The premise of short selling is that the price first rises to their strong flat line, so who is the first driving force? If the contract is dominated by long positions, new long orders enter the market, OI increases, rates rise, prices are driven by leveraged funds, and then short positions are triggered. In this case, we will see that OI is elevated. In fact, the OI this time has been decreasing almost from beginning to end, with no traces of large-scale entry of new leveraged funds. So, let's take a look at the spot market again. The exchange spot relative trading volume (SRV), which represents the current level of trading activity relative to the recent average level, can clearly reflect a fact: From August 19th to August 20th, SRV has reached 2.94, which means the current trading volume is three times the average trading volume of the past 30 days. Based on data from the past two years, there was a similar increase in SRV on February 5th and June 5th, but at that time, there was an increase in volume during the downward trend, which was a panic turnover. Besides, most of the data that can be compared to this one are in a bull market. For example, the SRV surge on November 6, 2024, occurred just before the main uptrend of the bull market began. So, this rebound (which we currently consider to be a rebound) is different from the situation when it rebounded to 9.6w in January and 8.2w in May. The former is mainly driven by leverage, while the latter has seen demand for spot goods. ------------------------------------------- The above is just a clear explanation of the logic. It does not necessarily mean that a trend reversal can be determined based on this. But a rebound with spot demand is a potential sign, for the first time since entering a bear market. Including, as we have previously shared, the price has exceeded STH-RP; The seller depletion index has entered the extreme zone; These can all be considered as evidence. The market trend is gradually emerging, not predicted. Only when more and more evidence points to the same conclusion, will the certainty be higher; Of course, the price may also be higher at that time.