The crypto market succumbed to selling pressure on Tuesday with bitcoin and ether falling back from relative safety into a zone that could see the two largest cryptocurrencies by market capitalization challenge multi-month lows.
BTC is trading at $107,800, while ETH is at $3,867 after bouncing over the weekend before giving back gains on Tuesday.
Analysts will now assess whether the crypto market formed a “lower high” pattern and will continue to decline. The next sign would be if bitcoin slips below the October 17 low of $103,700.
Derivative positioning
- The Bitcoin futures market is showing a measured recovery, with open interest rising to $26.06 billion as traders gradually re-engage.
- The three-month annualized basis remains stable within the range of neutral to bullish 5%-6%. Significantly, funding rates have returned to mostly neutral or positive, indicating that the previous short-side conviction has been cleared. OKX is currently leading this shift with a high positive rate of 7.51%.
- The BTC options market is strongly bullish, supported by the rising expectation of future price fluctuations. The implied volatility structure is upward, signaling that the market expects volatility to increase over time.
- At the same time, the 25-delta bias is increasing across all timeframes and now exceeds 11.86%. This high positive bias confirms that traders are paying a large premium for upside exposure – call options – reflecting significant belief in a sustained rally despite near-neutral 24-hour put-call volume, which is 49%-51% in favor of puts.
- Coinglass data shows $320 million in 24-hour liquidations, with a 76%-24% split between longs and shorts. BTC ($88 million), ETH ($85 million) and others ($33 million) led the way in fictitious liquidations.
- The Binance liquidation heatmap indicates $112,300 as a core liquidation level to monitor in the event of a price rally.
Token Talk
By Oliver Knight
- South Korean exchanges Upbit and Bithumb listed a number of tokens with lower market capitalization on Tuesday, leading to a series of explosive moves to the upside.
- Upbit especially added with won and dollar trading pairs. SynFutures is a decentralized derivatives exchange that hopes to compete with HyperLiquid and Aster.
- F climbed more than 50% after the IPO before giving back some of the gains. Trading volume increased by 669% to more than $200 million.
- Bithumb, meanwhile, listed ZORA and RECALL. The former rose by more than 10%, while RECALL moved in line with the broader market.
- The post-listing gains bucked the altcoin market trend on Tuesday, with several assets facing double-digit moves to the downside. The CoinDesk 80 Index fell 4.5% in the past 24 hours.
- CAKE and ETHFI both lost 10%, while ETH, BNB and SOL all fell 4%-5% as negative sentiment crept back into the market.
- Traders are now analyzing whether the market’s rally over the weekend formed a lower high, signaling a bearish trend and potential bear market reversal after new record highs less than a month ago.
