LIGHT has become one of the top performers in the last 24 hours. The token’s price action recorded gains of 13% as traders increased their exposure to the market.
Interestingly, the rally was also accompanied by a sharp increase in derivatives activity, suggesting that the move could spark more than just spot market interest.
The question now is whether the current momentum is strong enough to continue or not.
Are Network Derivatives Metrics Supporting the Rally?
The rally appears to find support in derivatives market indicators. According to the long/short ratio data, almost 68% of open positions appeared to be tilted toward the bulls. In other words, most traders are still betting on the rally continuing.
This is important since strong rallies often begin to peter out as traders begin to reduce their exposure. So far there is little evidence of this. Instead, market participants are adding long positions even after the recent price surge – a sign that confidence remains intact.
This change was also accompanied by a significant increase in open interest. In fact, the network’s Open Interest also saw a daily increase of 12%, reaching 12.4 million.
On its own, a slight increase in Open Interest does not reveal direction. However, when this occurs alongside rising prices and a long-dominated market, it often indicates the arrival of new capital on the bull side.
A rise in power?
The recent rise has also strengthened the short-term structure of the token.
Rather than fading after the initial move, buyers continued to step in, allowing the price to hold on to much of its gains. Such behavior generally demonstrates the confidence of market participants.
At the time of writing, the token was trading above key exponential moving averages, with the next resistance at $0.18 the next target for buyers.
Liquidity remains the next objective
As sentiment becomes increasingly bullish, attention is now shifting to liquidity above the price at press time.
In fact, network liquidation data highlighted the increased presence of several liquidity clusters above the trading price level at press time. If buyer dominance remains intact, LIGHT could continue to advance towards these higher liquidity zones.
What comes next?
Collectively, these factors seem to suggest that momentum remains constructive. Whether this momentum will be enough to cause a complete liquidity sweep will likely depend on how buyers continue to increase their exposure in the coming sessions.
Final summary
- LIGHT’s long positions now represent 68% of market exposure, highlighting traders’ growing bullish conviction.
- Rising open interest rates, alongside price gains, suggested new capital was entering the market.
