bitcoin held above $63,000 on Monday, looking to build on a 4% rally on Sunday fueled by Strategy (MSTR) CEO Michael Saylor, hinting at more buying of the largest cryptocurrency. Saylor’s stance is a signal that markets take seriously given the company’s history of aggressive accumulation.
Bitcoin’s stability is breathing life back into less-watched corners of the market. Audiera’s BEAT token is up 78% in the last 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 gaming platform built on BNB Chain that treats AI characters and virtual idols as economic participants. Siren is also a BNB-based Web3 AI project. The catalysts for these movements 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 acted as long-term support and a key battleground between bulls and bears at major cycle turning points.
“The sentiment index plummeted to 8, once again showing single-digit values on Monday, after a two-month pause 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 Kuptsikevich, chief market analyst at FxPro, said in an email.
“Under similar conditions at the time, bearish 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 clear example of how brutally last week’s price drop wiped out leveraged positions across the market.
- One silver lining: The decline in open interest suggests that traders largely did not accumulate new short positions during the liquidation, meaning the move was driven by forced long liquidations rather than aggressive bearish conviction.
- Ether (ETH) tells a similar story. Open interest has retreated to 14.58 million ETH from 15.98 million ETH at the end of last month.
- It is the most prominent currency of the last 24 hours. Open interest has risen more than 13% in the past 24 hours to 1.64 million BCH, the highest level since July 2023, even as its price resisted the recovery with an 8.3% drop. Rising open interest versus a falling price generally indicates short accumulation, and BCH’s negative 24-hour cumulative volume delta confirms this: traders are actively shorting at market prices rather than placing limit orders. The setup points to persistent bearish sentiment and the possibility of further losses.
- Canton Network’s CC token is also seeing an increase in open interest.
- On the volatility front, bitcoin’s stabilization is being reflected in the so-called fear indicators. The BVIV 30-day annualized implied volatility index has retreated to 50% from a high of nearly 59% on Friday, suggesting acute stress is fading and conditions support at least some consolidation. Ether implied volatility fell from 75% to 69%.
- Options market sentiment has changed markedly. The five most actively traded instruments on Deribit in the last 24 hours are calls, including a $170,000 strike expiring on December 25. That’s a bet that Bitcoin will surpass that level before the end of the year. These no-money calls work like cheap lottery tickets: small premium, high odds, and a huge reward if the trade goes well.
- One 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 movements to rebalance their books, a dynamic that could amplify swings in either direction.
symbolic talk
- Zcash (ZEC) rallied 45% from last week’s low after developers proposed a fix for a critical spoofing bug in its privacy-focused Orchard pool.
- Ironwood’s proposal would move users to a new, fixed privacy pool and allow anyone running the Zcash software to verify that no more than the correct amount of ZEC exists.
- As coins migrate out of the old pool, any counterfeit ZEC will be exposed or stranded and destroyed, which could reveal whether the flaw was ever exploited, although the developers say it is unlikely to be abused.
- Elsewhere, Tether’s dollar-pegged stablecoin USDT briefly surpassed 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 capitalization of $183 billion compared to USDT’s $186 billion. The token has since recovered, putting it back above USDT, although it remains well below bitcoin. The level of 1.2 trillion dollars.
