The cryptocurrency market faces one of its toughest tests yet, with bitcoin The price broke below the crucial $98,000 support level following a wave of selling pressure in a low liquidity environment.
The liquidation triggered more than $1.1 billion in liquidations, about half of which occurred in bitcoin trading pairs, according to CoinGlass.
The altcoin sector performed worse, with ether falling 9% in 24 hours, while several altcoins suffered double-digit downward movements. The CoinDesk 20 index fell 8% even with the best performance. losing 3%.
The cryptocurrency crash coincided with a massive sell-off in stocks. Nasdaq futures (NQ) lost 2.95% of their value in the last 24 hours.
Derivatives positioning
By Omkar Godbole
- Bitcoin’s 30-day implied volatility index, BVIV, which soared to 50% annualized during Asian time, has fallen back to 47.8% even though the spot price remains near daily lows around $97,000.
- This suggests that despite the recent sell-off, there is no panic buying of options, indicating a more measured market response.
- Ether volatility indices paint a similar picture.
- Open interest (OI) in BTC-linked futures remains stable, while OI in ETH, SOL, XRP, SUI, ADA, LINK, UNI and most other tokens has decreased more than 5% in a sign of capital outflows.
- On the CME, the ether futures premium has fallen to 4.26%, the lowest since April, while BTC remains relatively elevated above 5%. It is a sign of reduced demand for ETH relative to BTC, even though the price of ETH has increased against BTC.
- The market swoon fueled demand for BTC and ETH offerings on Deribit. BTC block flows showed put spreads and risk reversals. In the case of ETH, put spreads and diagonal calendar spreads dominated the flows.
symbolic talk
By Oliver Knight
- The altcoin market was decimated by a sell-off of low liquidity on Friday as ether fell more than 9% in 24 hours and tokens including aave , and lost more than 10%.
- More than $1.1 billion in derivatives positions were liquidated during the same period, of which $510 million was attributed to bitcoin, according to CoinGlass.
- Several altcoins have fallen to multi-month lows. Aave is now trading at its lowest since May and ETH at its lowest since July.
- The altcoin market will depend on whether bitcoin, the market anchor, can get out of danger and break back above the $98,000 support level.
- Failure to do so would confirm a bearish trend and a possible bear market reversal from the October high of $126,000.
- There was a ray of hope for altcoins: the privacy coin sector. Zcash and monero Both were in the green on Friday as they defied market pressure.
- The ZEC is now up more than 1,000% since August, as investors come full circle, returning to a narrative focused on libertarian politics over speculative profits.
