bitcoin and ether They extended their declines over the past 24 hours, each falling more than 7% as a wave of bearish sentiment took over the market.
The Fear and Greed Index fell to 11:00, the lowest level this year, indicating extreme bearish sentiment.
“Bitcoin has returned to an area that was strong resistance from March to October 2024. This explains the current interest from bargain hunters,” Alex Kupsikevich, chief market analyst at The FxPro, said in an email to CoinDesk.
“If we look at a similar phase of the market cycle, an equally intense sell-off in May 2022 ended with price consolidation around one level for a month, followed by a deeper decline,” he added.
Bitget’s chief market analyst said derivatives selling and leveraged positioning amplified declines across the board, compressing the price action. Macro and sentiment headwinds, including risk-off reactions to geopolitical and interest rate uncertainty, have reduced appetite for higher beta assets like XRP, he said.
In traditional markets, oil price volatility remained high, discounting a possible escalation of tensions between the United States and Iran. A rise in oil could increase inflationary momentum around the world, further complicating matters for cryptocurrency bulls.
Derivatives positioning
- The cryptocurrency futures market continued to see capital outflows as cumulative theoretical open interest fell to $103 billion and leveraged positions faced forced closures due to tight margins.
- Centralized exchanges liquidated over $800 million in leveraged bets in the last 24 hours and the figure may increase significantly given that BTC just fell below the crucial support of $70,000.
- Despite the sell-offs, 90-day bitcoin futures are still trading at a premium to the spot price. Bear markets typically bottom out when the premium evaporates.
- Open interest (OI) on a few select tokens, such as link , and PEPE (PEPE) has increased.
- Annualized perpetual funding rates for several altcoins turned negative, a sign of increased demand for bearish plays, which is typical of a bearish trend.
- On Deribit, options reflect maximum fear, with short-term bitcoin and ether placing the trade at a premium of more than 10 points to call options.
- Bearish plays such as put spreads continue to dominate bitcoin block flows. Block trades are large bets negotiated privately without an over-the-counter.
symbolic talk
- The altcoin market broadly followed bitcoin during Asian and European hours, with prolonged losses in privacy coins monero. and zcash both with a drop of up to 7%.
- XRP lost more than 10% overnight after being overwhelmed by $30 million worth of liquidations. The precipitous drop increased by one level at 09:00 UTC when prices fell from $1.44 to $1.35.
- The only outlier in the altcoin market was the derivatives exchange token MYX, which posted a 4% gain in the last 24 hours to build on a 56% year-to-date rally.
- The bitcoin-heavy CoinDesk 20 (CD20) index lost 8.34% in the last 24 hours, outperforming the altcoin-dominated CoinDesk 80 (CD80), which fell 5.92%.
- Several altcoins are now showing signs of a deep downtrend characterized by a series of lower lows and highs not seen since the 2022 bear market.
