The crypto market succumbed to selling pressure on Tuesday, with bitcoin and ether retreat from relative safety to an area where the two largest cryptocurrencies by market value could challenge multi-month lows.
BTC is trading at $107,800 while ETH is at $3,867, having bounced over the weekend and then giving back gains on Tuesday.
Analysts will now evaluate whether the cryptocurrency market formed a “lower high” pattern and will continue to fall. The next signal would be if bitcoin falls below the October 17 low of $103,700.
Derivatives positioning
- The bitcoin futures market is showing a measured recovery, with open interest rising to $26.06 billion as traders gradually re-engage.
- The three-month annualized basis remains stable within the neutral to bullish range of 5% to 6%. Significantly, funding rates have returned to being largely neutral or positive, indicating that the short-term conviction seen previously has dissipated. OKX is currently leading this change with a high positive rate of 7.51%.
- The BTC options market is strongly bullish, supported by the growing expectation of future price swings. The implied volatility term structure is upward sloping, indicating that the market expects volatility to increase over time.
- At the same time, the delta 25 bias is increasing in all periods and now exceeds 11.86%. This high positive bias confirms that traders are paying a large premium for upside exposure (call options), reflecting significant conviction of a sustained rally, despite near-neutral 24-hour puts volume, which is between 49% and 51% in favor of puts.
- Coinglass data shows $320 million in 24-hour liquidations, with a 76% to 24% split between long and short positions. BTC ($88 million), ETH ($85 million), and others ($33 million) were the leaders in terms of notional settlements.
- The Binance settlement heatmap indicates $112,300 as the central settlement level to monitor, in case of a price surge.
symbolic talk
By Oliver Knight
- South Korean exchanges Upbit and Bithumb listed a number of lower market cap tokens on Tuesday, sparking a series of explosive moves higher.
- Upbit was added noticeably with won and dollar trading pairs. SynFutures is a decentralized derivatives exchange that hopes to rival HyperLiquid and Aster.
- F rose more than 50% post-listing before giving back some of the gains. Trading volume increased by 669% to over $200 million.
- Meanwhile, Bithumb included ZORA and RECALL. The former rallied more than 10%, while RECALL moved in line with the broader market.
- The surges that followed the quotes bucked the altcoin market trend on Tuesday, with several assets facing double-digit downward moves. The CoinDesk 80 index fell 4.5% in the last 24 hours.
- CAKE and ETHFI lost 10%, while ETH, BNB, and SOL fell 4% to 5% as negative sentiment returned to the market.
- Traders are now analyzing whether the market’s bounce over the weekend formed a lower high, which is indicative of a bearish trend and a possible bear market reversal following new all-time highs less than a month ago.
