Bitcoin Rally Could Lose Steam as Short Covering Fades: QCP
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QCP Research says Bitcoin’s recent rally has been driven partly by short covering rather than fresh leveraged positions, with open interest falling even as strong spot ETF inflows—now nearing the 95th percentile over the past year—added crypto demand. The firm warns the rally could become fragile if short covering loses momentum and new spot ETF or other demand does not replace it.
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Bitcoin’s latest rally appears to be driven partly by short covering rather than fresh leveraged positions, according to QCP Research. Open interest has fallen as BTC advanced, while strong spot ETF inflows have provided additional demand, the firm noted.
Spot demand is also strengthening, with QCP noting that ETF inflows are nearing the 95th percentile of the past year. However, the firm warned that the rally could become more fragile if short covering loses momentum and new demand does not replace it.
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