Crypto markets rallied on Wednesday as oil momentarily fell below $100 a barrel after US President Donald Trump said the war in Iran will end in “two or three weeks.”
bitcoin is trading at $68,500, having risen 0.4% since midnight UTC and 3.1% in the last 24 hours, while ether (ETH) is back at $2,130 after a brief period below $2,000 last week.
The broader crypto market remains in a bearish trend dating back to October, although sentiment has changed slightly after a period of consolidation between $62,500 and $75,000 since early February.
A selection of altcoins have performed particularly well, notably algorand (ALGO), which is up 22% in the last 24 hours as it recovers from oversold territory.
Derivatives positioning
- The cryptocurrency futures market appears to be churning rather than building clear directional positions, as trading volumes have increased 23% to $210 million in the last 24 hours, while open interest has remained broadly stable at around $106 billion.
- Open interest in major USD and USDT-denominated futures has clearly moved away from BTC’s recovery from the weekend low around $65,000. This suggests that the bounce is not being driven by a significant buildup of leveraged positions, but rather by spot demand or short covering, pointing to a lack of solid conviction behind this move.
- Ether’s OI has increased slightly along with its spot price, indicating the participation of leveraged traders.
- ETH and ZEC stand out as top coins with positive OI-adjusted CVD and funding rate. This combination targets aggressive bidding in the futures market, in which traders actively open long positions and pay a premium to hold them.
- The ADA, XMR, BCH and SHIB market suggests otherwise.
- The implied volatility indices of Bitcoin and Ether continue to present a calm outlook.
- On Deribit, risk reversals continue to show a bias for BTC and ETH put options, which offer protection against price declines. The bearish trend is slightly more pronounced in BTC options.
symbolic talk
- The CoinDesk Computing Select Index (CPUS) was the best-performing benchmark index on Wednesday, rising 2.7% since midnight UTC, while the CoinDesk Smart Contract Platform Select Capped Index (SCPXC) and the DeFi Select Index (DFX) rose 1.5% each.
- Bitcoin and the dominant CoinDesk 5 (CD5) and CoinDesk 20 (CD20) are up 0.35% and 0.69% respectively, indicating an underperformance of the broader altcoin market.
- Algorand (ALGO) led the market gains on Wednesday, but was closely followed by decentralized finance (DeFi) tokens MORPHO and JUP, which posted double-digit gains.
- A disproportionate increase in open interest for assets like ETH and ZEC suggests that the recent move has been supported by leverage rather than spot purchases, which could be revealed in news contrary to Trump’s statement released this week.
