Caton Network [CC]: A 566% Surge Followed by a 25% Decline

Recently, Caton Network [CC] experienced a dramatic increase in value, skyrocketing by 566% immediately after being listed on Bybit. However, this was followed by a significant decline of 25% as bearish sentiment took over among traders. The volatility in the derivatives market, driven largely by Bybit investors, has created uncertainty about CC's future price movements, with key support levels coming into play.

Key Takeaways

The sudden drop in CC's price stems from increased bearish sentiment and a rise in short positions from Bybit traders.
If the price maintains support at the $0.10 zone, CC may bounce back toward the $0.17 mark.
Recently, Caton Network [CC] faced a sharp downturn, marked by a nearly 25% drop in market interest at the time of this report.

Bybit listing triggers CC surge and sharp 25% crash as traders turn bearish

How Bybit Investors Fueled the CC Rally, Then Withdrew Their Support

CC was launched on Bybit during the early hours of November 10, creating an impressive bullish wave as investors rushed in. This prompted a massive price jump of 566%, reaching an all-time high of $0.20. This surge illustrated a strong level of confidence from Bybit investors, many of whom shifted their stablecoin assets into CC in hopes of getting early profits.

CC long-to-short ratio. Source: CoinGlass

However, the situation has taken a turn for the worse. Current market analysis reveals that Bybit investors have adopted a more negative outlook, especially in the realm of derivatives trading. The Long-to-Short Ratio indicates that 52.39% of the trading volume now consists of short positions, showing a notable shift in market sentiment. Bybit now holds the second-largest open interest in CC, which has surpassed $5 million in derivatives liquidity, allowing traders there to significantly influence price movements.

Bearish Trends Beyond Bybit

The negative sentiment is not restricted to Bybit alone; it is reflected across the market as a whole. Data shows a downturn in bullish positioning as the atmosphere continues to change negatively. The Open Interest (OI) Weighted Funding Rate—a metric used to gauge market bias—stood at -0.0784% at the moment of this report. This rate indicates that the flow of funds is primarily from sellers, suggesting the recent 10% increase in OI (approximately $1.87 million) is largely driven by short traders.

CC OI weighted funding rate. Source: CoinGlass

Similarly, the Long-to-Short Ratio has dipped below the neutral 1.0 level, now resting at 0.9391. This drop reveals that selling activity is currently outweighing buyer demand in the market. The combination of these bearish signals indicates that CC may experience additional downsides unless new buying interest emerges to balance the current pressures.

Possible Price Drop Before Recovery

A short-term price decline seems likely. Liquidation heatmaps show significant clusters of shorts positioned below the current price, which could potentially drag CC down towards the $0.10 level. These lower price clusters often serve as demand zones, drawing in buyers as long contracts are liquidated. If this support zone holds, CC may see a rebound, possibly recovering to the $0.17 level. For the near future, the outlook appears to suggest a probable dip before any sustained increase occurs.

CC liquidation heatmap Source: CoinGlass