The cryptocurrency market experienced a “sell the news” reaction to the Federal Reserve’s interest rate cut and the United States’ trade deal with China, with bitcoin. returning to the $110,000 support level.
Traders will now wonder if the recent high of just $116,000 will mark a lower high than bitcoin’s record $126,000 hit earlier this month, signaling signs of a downtrend and reversal.
Bitcoin dominance dipped a few basis points on Thursday, suggesting some altcoins are outperforming BTC even as market weakness is reflected in major cryptocurrencies.
Derivatives positioning
By Saksham Diwan
- Despite the decline in the price of bitcoin following yesterday’s Fed news, the BTC futures market is showing strength: open interest (OI) has increased slightly to $27.2 billion, confirming minimal liquidations and a quick re-entry of buyers.
- Crucially, highly polarized funding rates have normalized and are now trending neutral and nearly flat in most places. This indicates underlying market resilience and less volatile and more measured sentiment compared to previous uncertainty.
- The BTC options market maintains a strong bullish trend, although short-term conviction has moderated.
- The implied volatility (IV) term structure still shows a short-term pullback before moving into long-term contango. The one-week 25 delta bias has fallen to 8% from 10% yesterday, but traders are still paying a significant premium for short-term call options.
- This reduced conviction is reflected in the 24-hour put/call options volume ratio, which remains bullish at 55:44 in favor of calls.
- Coinglass data shows $821 million in 24-hour liquidations, with a 79-21 split between long and short positions.
- BTC ($368 million), ETH ($188 million), and others ($52 million) were the leaders in terms of notional settlements. The Binance liquidation heatmap indicates $109,700 as the central liquidation level to monitor, in case of a price drop.
symbolic talk
By Oliver Knight
- More than $80 billion was wiped off the total cryptocurrency market capitalization in the past 24 hours, as traders “sold the news” following the Federal Reserve’s interest rate cut and a US-China trade deal.
- bitcoin and ether The two largest cryptocurrencies are down 2.5% as they struggle with support levels. XRP and XLM were the worst performing tokens of the top 20, losing 3.5% and 3.3% respectively.
- Plasma continues to make headlines for all the wrong reasons, falling 14% in 24 hours to compound an overall loss of 81% since September 28.
- A ray of optimism in the altcoin market was TRUMP, the memecoin backed by the US president, which rose 6.8% after reports emerged that Fight Fight Fight, the company that manages the token, plans to acquire US fundraising platform Republic.
- TRUMP is up 45% this week, although at $8.40 it is still well below his all-time high of $45.47.
- Bitcoin dominance decreased slightly from 59.3% to 59.0%, suggesting that some altcoins are outperforming Bitcoin during this latest period of selling pressure.
