Open Interest in NEAR Protocol Reached $1.92 Billion

NEAR Protocol set a new record in the futures market. The open interest in NEAR contracts reached $1.92 billion on October 12, marking the highest level for the token. At that time, NEAR was trading at $5.88. This surge was noticeable: in July and August, open interest ranged from $300 million to $450 million. It began to rise in mid-September and surpassed the $1 billion level in a few days. Over approximately two months, traders invested about four times more in NEAR futures.

The price followed the same path. NEAR rose from around $1.60 in August to nearly $6.00. The daily chart shows that the coin is trading significantly above its moving averages. The long-term trend, tracked by the black line, is around $2.55, and the price exceeds this value by two times. However, the record came with a warning. NEAR reached $6.00 and then sharply fell. The current daily candle is red, and the price is now around $5.07. Open interest also fell from its peak and is now closer to $1.5 billion. This indicates that many traders closed their positions or were forced out of the market during the decline.

This is the danger of high open interest. When many traders use leverage, a sharp move in either direction can trigger a chain reaction of forced sales. The drop from $5.88 to $5.07 looks like such a release of positions. The Relative Strength Index (RSI) was above 75 at the end of September, confirming that the rally was overheated. It has now cooled to around 55, indicating that the market is no longer overheated. Trading volume also decreased in October, indicating less interest than during the breakout in September. Key levels are evident. On the downside, the green moving average around $4.60– is the first support, and last week's low around $4.30– is the next level. A break below these levels would open the way to $3.90. On the other hand, buyers need to break back above $5.50 to attempt to reach $6.00 again. At the moment, NEAR shows strong momentum and record interest from traders. However, a record in open interest does not guarantee further growth. It shows that many people are betting on this token, and it can influence the price in either direction.