Bitcoin consolidated on Tuesday after reaching $76,000, the highest level since February 4, at the start of the session. The largest cryptocurrency fell back to just below $73,500, down 1.5% since midnight UTC.
It’s not the only cryptocurrency to have cooled off. Ether (ETH) lost 1.5%, solana (SOL) fell 2.5% and 4.5%.
On the other hand, futures on the Nasdaq 100 and S&P 500 rose 0.6% despite oil prices above $100 per barrel and the war in Iran continuing to rage.
Despite the decline in crypto markets, the average Relative Strength Index (RSI) remains firmly in “overbought” territory, suggesting further declines towards $72,000 could be on the cards.
However, such a move would look like a period of consolidation after bitcoin rose more than 15% from $65,000 since March 8.
A bounce between $72,000 and $74,000 would indicate the formation of a new support level, potentially serving as a platform for a rally above $80,000.
Positioning of derivative products
- Bitcoin futures open interest (OI) rose 2% to a three-week high of 685.2K BTC. This, coupled with a positive cumulative volume delta (CVD), indicates a bias towards long bullish bets.
- Ether futures activity is also showing an uptrend similar to bitcoin.
- The SOL market is sending mixed signals. An increase in OI is accompanied by negative funding rates and a CVD close to zero, indicating a bearish tone.
- ADA and BCH stand out with slight declines in OI, a sign of capital outflows.
- Options traders appear more bearish on Bitcoin than Ether. On Deribit, bitcoin expires in short-term trading at a higher premium to calls than ether.
- Volatility strategies such as straddles have dominated Bitcoin block flows. Ether traders looked for buy spreads and straddles.
- In the case of BTC, two of the most popular options positions are the $60,000 put and the $75,000 call. Volatility picked up early Tuesday as prices approached $75,000.
Symbolic discussion
- The altcoin market has suffered a bigger pullback than major cryptocurrencies since midnight, with some segments of the market falling more than 5% after a fierce rally on Monday.
- CoinMarketCap’s “altcoin season” indicator remains at 49/100 – its highest level since the start of the year – reflecting risk sentiment towards the altcoin.
- The US president-themed TRUMP memecoin lost more than 6% of its value in the past 24 hours as traders locked in profits from last week’s “gala luncheon” announcement.
- There was a similar fall for Pepe (PEPE) after the frog-themed memecoin dominated the broader crypto market with an upward move on Monday.
- The CoinDesk Memecoin Index (CDMEME) was the worst performing benchmark over the past 24 hours, losing around 1%, while the CoinDesk 80 (CD80), an index comprised of a broad range of altcoins, is up 1.35%.
