Cryptocurrency prices fell in the past 24 hours, with the CoinDesk 20 Index (CD20) losing 1.7% and all members lower. Token prices were hit by a sell-off in US stocks after tech firms Meta ( META ) and Microsoft ( MSFT ) raised their AI investment projections, raising concerns about overspending.
Bitcoin was the least changed among the 20 largest cryptocurrencies, falling 0.2% to just below $110,000 on the 17th anniversary of the release of its white paper. The second best performer, ether fell 1.3% as the broader altcoin market entered the weekend after an overall weaker seven days.
Directional signals from derivatives are mixed. Bitcoin futures show no clear trends, with funding rates little changed, open interest only slightly lower and the three-month annual basis remaining muted.
Options showed a shift towards a neutral-to-bearish sentiment in the near term, although there is generally a positive structural bias with a premium paid for short-term calls.
Derivative positioning
By Saksham Diwan
- The Bitcoin futures market is in a state of consolidation where there is no clear trend.
- Open interest (OI) fell slightly to $26.16 billion, although it remains elevated.
- Funding rates across most venues are little changed, indicating low overall demand. However, there is isolated bullish demand on specific platforms, such as Deribit, where rates rose to 8% year-on-year.
- The three-month annualized basis, meanwhile, remains subdued in the 4%-5% range, confirming that the basis trade is currently unappealing.
- In options, there is a shift towards a near neutral-to-bearish sentiment, despite maintaining a positive structural bias. The implied volatility (IV) term structure continues to show a short-term decline before moving into long-term contango.
- While one-week 25-delta bias remains positive at 8%, indicating that a premium is still being paid for short-term calls, this belief is challenged by 24-hour put/call volume, which has fallen to 56%-43% in favor of puts, suggesting that short-term downside hedging or speculation is currently dominating trading activity.
- Coinglass data shows $879 million in 24-hour liquidations, with an 86-14 split between longs and shorts. BTC ($303 million), ETH ($193 million) and others ($79 million) led the way in fictitious liquidations. The Binance liquidation heatmap indicates $111,000 as a core liquidation level to monitor in the event of a price rally.
Token Talk
By Oliver Knight
- The altcoin market is heading into the weekend lower than a week ago, with ether lost 1.3% to $3,840.
- Many tokens broke through key levels of support during the period, pulling the average down. The CoinDesk 80 index, a measure of the smallest of the top 100 tokens, fell 3.8%, while the CoinDesk 20 fell 1.3%.
- Double zero (2z), plasma gate token (GT) and all fell between 15% and 21% after extending losses on Friday.
- A few tokens bucked the trend, notably a privacy coin in vogue which is up 5% on Friday to add to a weekly gain of 47%.
- TRUMP memecoin also performed well after it emerged that the company behind the token plans to buy fundraising platform Republic. TRUMP is up 35% over the past seven days.
- The altcoin market outlook now hinges on whether ether can cling to its current level of support at $3,700, an area that produced three rejections in October.
- A break below this level would indicate weakness and a potential macro trend reversal, which is likely to be reflected across the entire altcoin market.
