Bitcoin held above $63,000 on Monday, looking to build on a 4% Sunday rally spurred by Strategy ( MSTR ) Chairman Michael Saylor hinting at further buying in the largest cryptocurrency. Saylor’s stance is a signal that markets are taking seriously given the company’s track record of aggressive accumulation.
Bitcoin’s stability breathes life back into less-trodden corners of the market. Audiera’s BEAT token is up 78% in the past 24 hours and Siren’s SIREN added 33%, making them the two best performing coins in the top 100 by market cap. Audiera is a Web3 entertainment and rhythm game platform built on the BNB Chain that treats AI characters and virtual idols as economic participants. Siren is also a BNB-based Web3 AI project. The catalysts for the measures are unclear.
The broader market recovery depends on what bitcoin does next. It is currently trading near its 200-week simple moving average, a level that has historically served as long-term support and a key battleground between bulls and bears at major turning points in the cycle.
“The sentiment index plunged to 8 and showed single-digit values once again on Monday, after a two-month hiatus and failed attempts to consolidate in positive territory. Judging by the dynamics near Bitcoin’s 200-week moving average and the sentiment index, the situation looks like mid-2022,” Alex Kupts analyst said in an email to Fxchief.
“Under similar conditions at the time, the downward momentum weakened, but a full reversal did not occur until many months later,” he wrote.
Derivatives positioning
- Bitcoin futures open interest collapsed to 716,000 BTC from a record high of 901,000 BTC just four days ago, a stark illustration of how brutally last week’s crash wiped out leveraged positions across the market.
- One silver lining: the decline in open interest suggests traders largely did not pile into new shorts during the selloff, meaning the move was driven by forced long liquidations rather than aggressive bearish conviction.
- Ether (ETH) tells a similar story. Open interest has pulled back to 14.58 million ETH from 15.98 million ETH late last month.
- is the featured coin of the past 24 hours. Open interest has risen over 13% over the past 24 hours to 1.64 million BCH, the highest level since July 2023, although the price received the rebound with an 8.3% decline. Rising open interest against a falling price typically signals short accumulation, and BCH’s negative 24-hour cumulative volume delta confirms it: Traders are actively shorting at market prices instead of placing limit orders. The setup points to a persistent bearish sentiment and potential for further losses.
- Canton Network’s CC token is also seeing a surge in open interest.
- On the volatility front, the stabilization in bitcoin shows itself in so-called fear gauges. The 30-day annualized implied volatility index BVIV has pulled back to 50% from a high of nearly 59% on Friday, suggesting acute stress is fading and conditions are supporting at least some consolidation. Ether’s implied volatility retreated to 69% from 75%.
- The mood on the options market has changed noticeably. The five most actively traded instruments on Deribit in the last 24 hours are all calls, including a $170,000 strike that expires on December 25. It is a bet that bitcoin will rise above this level before the end of the year. These deep out-of-the-money calls work like cheap lottery tickets: small prize, long odds, and a massive payout if the trade goes well.
- A risk factor remains. The dealer’s gamma profile around $60,000 continues to point to a setup where market makers may be forced to trade in the direction of price action to rebalance their books, a dynamic that could amplify swings in either direction.
Token talk
- Zcash (ZEC) is up 45% from last week’s low after developers proposed a fix for a critical bug in its privacy-focused Orchard pool.
- The Ironwood proposal would move users to a new, repaired privacy pool and let anyone running Zcash software verify that no more than the correct amount of ZEC exists.
- As coins migrate out of the old pool, any fake ZEC will either be exposed or stranded and destroyed, potentially revealing whether the flaw was ever exploited, though the developers say abuse is unlikely.
- Elsewhere, Tether’s dollar-pegged stablecoin USDT briefly overtook ether (ETH) in market capitalization over the weekend as the latter fell along with the broader market.
- Ether fell from $2,000 to just over $1,500 from Friday to Sunday, bringing it to a market cap of $183 billion, compared to USDT’s $186 billion. The token has since recovered, bringing it back above USDT, although it remains well below bitcoin $1.2 trillion level.
