This seemed like the most appropriate stack exchange for this question even though the question isn't strictly quantitative, but I hope it's ok.
I read an article(Article Below) and can't seem to understand how the unwinding of long BTC futures will prevent further downside/selling risk thus preventing further drop of prices? How do BTC futures actually affect the price of BTC? As far as I know they're just bets on the underlying asset. If anything, shouldn't unwinding of long futures positions mean that the crypto market sentiment is becoming even more bearish and will further drop?
"A report from JPM late last week says the downside shift for Bitcoin looks to be ending.
JPM cite their analysis of open interest in Chicago Mercantile Exchange’s (CME) bitcoin (BTC) futures:
shows the unwinding of long positions in the futures market appears to be in its end phase rather than its beginning.
“As a result we see limited downside for crypto markets over the near term,” the move in crypto markets in August, “which reversed the post Securities and Exchange Commission (SEC) versus Ripple court decision rally” can be partly credited to the “broader correction in risk assets such as equities and in particular tech, which in turn appears to have been induced by frothy positioning in tech, higher U.S. real yields and growth concerns about China” "