Bitcoin fell 1.5% on Tuesday after failing to hold above $60,000 on Monday. It is now trading at $59,250 and looks set to challenge the weekend low of $58,800. Ether (ETH) is down 1.73% since midnight UTC and is trading at $1,580 after failing to break through $1,640.
Both assets are now testing critical multi-year support levels. Ether has bounced off this level twice before, in April 2025 and October 2023, while bitcoin is trading around its lowest point since late 2024. A failure to hold would leave both tokens without an obvious bottom.
The altcoin market saw excessive downside on Tuesday, with DeFi tokens ethena (ENA), jupiter (JUP) and ether.fi (ETHFI) all falling between 3.3% and 7.5% as risk appetite continues to wane.
The weakness contrasts with the traditional markets, where US stocks have been flat since midnight. S&P 500 and Nasdaq 100 futures posted gains of 0.03%, while the Dollar Index (DXY) gained 0.25%.
Derivatives positioning
- HYPE, the native token of decentralized exchange Hyperliquid, is up over 4.3% in the last 24 hours and is the only major token trading noticeably in the green.
- The rally looks spot-driven and has not excited traders to take on more derivatives risk for now. Open interest (OI) in HYPE futures remains around 40 million tokens, a level it has held since at least June 22.
- While the overall position remains bright, it leans bullish. Annualized funding rates are close to 10%, a sign that perpetual futures are trading above the spot price.
- The biggest OI gainer in the last 24 hours among major cryptocurrencies is the largest memecoin by market cap. Open interest has risen to 16 billion tokens, the highest since the October 10 crash and up from 13 billion a day earlier.
- However, inflows look bearish rather than bullish given the negative fund rates and negative 24-hour OI-adjusted cumulative volume delta. CVD signals that sellers are on the more aggressive side, hitting sell orders to cross the spread and fill their bearish bets at the best available bid.
- Bitcoin, Ether and XRP futures markets are offering some excitement, with open interest locked in recent ranges. Positioning in SOL remains high, with OI near record highs, a signal of potential volatility ahead.
- Volatility indices continue to point to calm on the market. BTC’s 30-day implied volatility gauge, BVIV, fell 11% to 44% on Monday and has remained around that level since. Ether’s corresponding index, EVIV, tells the same story.
- On Deribit, BTC continues to trade at a 10%-plus premium to calls across all timeframes, a sign of persistent downside concerns. ETH shows a similar pattern at the short end – weekly puts have a comparable premium – while further exits are noticeably cheaper than calls.
- Block streams featured a BTC short straddle, an options strategy that takes advantage of low volatility and price consolidation.
Token talk
- Native DeFi tokens struggled on Tuesday, and the negative sentiment didn’t stop there. AI tokens FET, TAO and RENDER all fell, as did privacy coins zcash (ZEC) and monero (XMR).
- Even hyperliquid ( HYPE ), which has outperformed its peers in recent weeks, is trading at $65.3 after falling 2.2% on Tuesday. HYPE’s chart appears to be in more of a consolidation phase after last month’s rally as opposed to a corrective phase, this is characterized by two higher highs alongside two higher lows.
- One token in black on Tuesday is the stellar lumen (XLM). The 2014 Ripple token maintains bullish sentiment after DTCC, the largest US financial market clearinghouse, said it will connect its tokenized securities platform to the Stellar network in the first half of 2027. The announcement spurred a 100% rally in late May.
- Another token bucking the trend is lighter (LIT), which benefits from its similarities to HYPE, being the original token of a decentralized perpetual exchange. LIT is up 23% over the past week, recording a double-digit increase in the past 24 hours alone.
