The crypto market consolidated on Tuesday with bitcoin and ether trading at $105,000 and $3,550, respectively.
Traders keep an eye on prices to see if they form a lower high, indicating a bearish trend, or continue to rise.
A drop below $98,000 for bitcoin would confirm the bearish scenario, while a move above the Nov. 2 high of $111,000 would present a bullish outlook.
Recent volatility in the cryptocurrency market has been driven by the strength of the dollar, with the DXY index rising from 96.2 on September 18 to 99.58 as indecisive comments from the Federal Reserve provide little guidance in terms of cutting US interest rates.
Derivatives positioning
By Omkar Godbole
- The 30-day implied volatility (IV) indices of BTC and ETH remain within recent ranges, suggesting a sustained phase of market calm, consistent with Wall Street’s VIX index, which has erased the October peak.
- Still, the golden cross on BTC’s IV suggests that the path of least resistance to volatility is on the higher side.
- On Deribit, both BTC and ETH put options are still more expensive than call options on the front-end. However, the demand for downside protection in BTC is stronger than in ETH.
- Block flows on the OTC Paradigm desk featured a long position in the BTC expiring November 29 placed at the strike price of $80,000 and a call for the call option expiring November 21 at the strike price of $110,000.
- In the futures market, open interest (OI) in UNI contracts increased by 80% in 24 hours, indicating greater participation in the price rally by leveraged traders. The OI in XRP has increased by 5% while it has decreased for most of the top 10 coins including BTC and ETH.
- On the CME, the OI in ether futures has fallen sharply to 2.10 million ETH.
symbolic talk
By Oliver Knight
- The altcoin market cooled on Tuesday, freezing a weekend rally that extended into Monday after US President Donald Trump announced a $2,000 dividend for some US citizens.
- Uniswap’s native UNI token outperformed the broader market after a proposal was made to burn millions of tokens, which would theoretically reduce supply and drive the price up. UNI rose more than 20% after the proposal was announced before consolidating.
- Those trading the recently launched Cantonal Network (CC) token did not have the same kind of optimism. Despite being backed by TradFi giants such as Goldman Sachs (GS), HSBC (HSBC), and Broadridge (BR), the token fell 33% on its debut.
- It now trades with a market capitalization of $3.8 billion despite recording just $55 million in 24-hour trading volume, according to CoinMarketCap.
- Canton Network, touted as a Layer 1 blockchain for institutions, reached more than 500,000 daily transactions in September, according to data provided by crypto custodian Copper.
- The stuttering debut echoes Plasma’s XPL token’s bearish start in October. That fell from $1.67 to $0.28 a month after its launch. XPL fell another 11.5% in the last 24 hours.
- The direction of the broader altcoin market will now depend on whether bitcoin and ether they can continue to get out of danger and establish new levels of support. Rejection at these levels would create another lower high to confirm a downtrend from the October highs.
