The crypto market fell on Thursday, with bitcoin losing 0.7% since midnight UTC to recently trade at $77,600.
The decline comes after the largest cryptocurrency hit its highest level since January on Wednesday, before sellers stepped in just below the $80,000 resistance level.
Oil prices rose 1.5% to $103 a barrel overnight following reports that the United States seized three Iranian tankers in Asian waters, sending prices of risky assets lower.
Ether (ETH) lost 2.5% and is now trading at $2,320 after testing $2,500 over the weekend.
The broader market remains optimistic, with bitcoin appearing to have broken out of a two-month range higher. It has stagnated between $63,000 and $75,000 since the beginning of February.
U.S. stock futures are lower on Thursday, with S&P 500 and Nasdaq 500 futures both losing 0.5% each overnight.
Positioning of derivative products
- While Bitcoin futures open interest (OI) fell to 775,000 BTC from a record near 800,000 BTC on Wednesday, it remains at historically high levels. Negative perpetual funding rates suggest that leveraged bets remain tilted to the bear side.
- This combination is rare. As a result, some analysts are calling BTC’s current advance the “most hated” rally, suggesting it could accelerate if bearish traders are forced to unwind their positions.
- Open interest in DOGE has surpassed 14 billion tokens, a level seen only once since October. However, the token’s funding rates are quite positive, suggesting growing demand for bullish bets.
- BCH, LINK, and LTC are other coins whose falling OI indicates capital outflow from the market.
- Cumulative Volume Delta (CVD) signals caution, showing that more trades were initiated by sellers who reached bids than by buyers who reached bids in the past 24 hours on most major altcoins, including XRP, SOL, and ETH. Meanwhile, BTC, M and CRO are the only assets with positive CVD readings. This suggests that the market as a whole is not yet fully participating in the Bitcoin rally.
- The 30-day implied volatility indices for Bitcoin and Ether continue to remain stable around the recently reached 2.5-month lows. In other words, calm reigns even as ceasefire negotiations between the United States and Iran fail and oil markets remain disrupted.
- On Deribit, BTC and ETH puts continue to be more expensive than calls, a sign of continued downside concerns. Over the past 24 hours, demand has been focused on BTC call options, bullish bets, with strike prices ranging from $80,000 to $85,000.
Symbolic discussion
- CoinDesk’s DeFi Select Index (DFX) is the worst-performing benchmark on Thursday, having lost 2.7% since midnight UTC, while the Bitcoin-dominated CoinDesk 20 (CD20) is down 1.1%.
- CoinMarketCap’s “Altcoin Season” index fell to 32/100 on Thursday, its lowest level in 10 days, as investors showed a preference for bitcoin following Wednesday’s attempt to surpass $80,000.
- Spark (SPK), a token to counter Thursday’s bearish price action, rose more than 70% after listing on Upbit, South Korea’s largest cryptocurrency exchange.
- Privacy Coin Monero (XMR) is up 3.3% since midnight, outperforming its peers DASH and ZEC, both in the red.
- DeFi tokens morpho and aave led the sector lower, losing 4.6% and 2.8%, respectively, as negative sentiment continues to plague the industry following the weekend’s $290 million KelpDAO exploit.
