Spot-Driven Recovery: Drying Selling Pressure and the Return of Neutral Sentiment
Following the leverage purge, the market entered its first phase of repair: a healthy recovery led by spot trading volume.
The Spot Inflow/Outflow chart provides quantitative evidence for this. On October 10th, during the crash, a massive green spike appeared on the chart, representing panicked holders moving large amounts of BTC onto exchanges ready for sale. Subsequently, especially during the recent rebound, red (representing net outflows) has regained dominance. This indicates that panic selling has ended, and long-term holders are re-accumulating as the price recovers,
withdrawing tokens from exchanges. The price chart corroborates the micro-tactics of this phase: between 09:00 on October 26th and 05:00 on October 27th – a span of nearly 20 hours – the price didn't surge violently but instead climbed slowly and steadily from the $111,000 zone to the $113,500 zone. This gentle ascent pattern is definitively not the work of excessive leverage; it perfectly confirms the thesis of drying selling pressure and spot accumulation. Market sentiment recovered from fear to neutral precisely during this slow, solid, spot-driven recovery period.
Low Funding Rates and Whales' Strategic Deployment
However, just as the broader market, relying on superficial data, might assume this was merely a cautious spot recovery, a profound data contradiction emerged. Judging by the Funding Rate, the market showed no signs of excessive long positioning.
Yet, the Coinglass Leverage Overview dashboard painted a starkly different picture: the market was not cautious but had already turned strategically bullish.
Binance (Retail Accounts) Long/Short Ratio: 1.1106 (Leaning Long)
Binance (Whale Accounts) Long/Short Ratio: As high as 1.266
Binance (Whale Holdings) Long/Short Ratio: As high as 1.2501
The "Low Funding Rate and 1.26x Whale Bullishness" are not contradictory; they reveal the market's layered structure. The low Funding Rate reflects market "PTSD" – after experiencing the $19 billion liquidation, traders are inclined to avoid aggressively chasing pumps with "market orders," which keeps the Funding Rate suppressed.
Whales are actively and significantly building long positions, but they are doing so in a smarter way (e.g., using limit orders, grid strategies, or accumulating at lower levels), quietly deploying their firepower. Market sentiment has indeed recovered from fear to neutral, but it hasn't stopped there; led by the whales, it has shifted towards a bullish bias.
$75.7 Billion OI Rebuild: Breakout at Key Levels and Two-Way Liquidation
The Open Interest (OI) chart shows that total OI has steadily recovered from its ~$60 billion lows, rebuilding to $75.7 billion. The market is undergoing rapid "re-leveraging."
Following the 06:00 price breakout, the price chart shows intense consolidation above $115,000. This explains the origin of the 24-hour long and short liquidation data. The battle for this new $115,000 price zone is exceptionally fierce, with the market efficiently conducting two-way liquidations – liquidating shorts (fuel for upward momentum) while also liquidating longs that blindly chased the pump post-06:00 (preventing the market structure from overheating again). Now, as the price is reclaimed, Open Interest ($75.7B OI) is rapidly returning, but the market's structure is fundamentally different. The vertical candle at 06:00 on October 27th already signaled the price breakout.
The market has emerged from the panic zone but has not entered a low-risk phase. It has merely shed retail irrationality and entered a re-leveraging stage dominated by strategic capital – a stage with potentially more explosive characteristics.
