The cryptocurrency market experienced significant selling pressure during the Asia session, leading Bitcoin (BTC) to fall to approximately $91,530, down from a local high of $93,750 reached just before midnight UTC. This decline is attributed to a failed attempt to break through the resistance level of $94,500, marking the third unsuccessful effort in the past five weeks.
In contrast to Bitcoin’s relative stability, the altcoin market faced more severe losses, with notable declines in PENGU and XRP, which dropped 6.5% and 3.5% respectively since midnight. Currently, Bitcoin’s trading range aligns more closely with levels observed in December, characterized by fluctuations between $85,000 and $94,500, continuing its downward trend that began in October.
This pullback seems to mirror a broader shift toward risk aversion among traders, which was echoed in the U.S. stock market as Nasdaq 100 futures dipped 0.32% in pre-market trading.
On the derivatives front, over the past 24 hours, $465 million in crypto futures positions were liquidated, with more than 50% of these being long positions. This marks a notable shift from the previous two days where short positions bore the brunt of liquidations. Despite this, global cumulative open interest in crypto futures remains stable above $143 billion, the highest level in nearly two months, indicating a generally bullish sentiment among traders.
Open interest specific to XRP, Dogecoin (DOGE), Sui (SUI), and Zcash (ZEC) saw declines of 5%-6%, likely due to profit-taking after recent upward movements in these assets. Conversely, CME Bitcoin futures have shown positive movement, with open interest climbing from 100,000 BTC to 111,000 BTC since December 30, although it remains below the year-ago level of over 191,000 BTC.
The volatility sentiment in the market shows mixed indicators; on Deribit, the put skews for Bitcoin and Ethereum (ETH) are weakening, but evidence of bullish sentiment has yet to emerge definitively. Bitcoin block flows reflect a variety of strategies, with strangle options hinting at a bullish volatility outlook, while call spreads suggest upward price expectations. On the other hand, Ethereum’s most favored strategy remains the straddle, indicating a predictive approach to market volatility.
Within specific sectors, memecoins and privacy coins struggled, with Zcash as a standout in the losses, down 4.5% since midnight. CoinDesk’s Memecoin Index dropped 1.5%, outperforming only slightly compared to the CoinDesk 5 index—which includes Bitcoin, Ethereum, XRP, Solana (SOL), and Cardano (ADA).
Nevertheless, a bright spot appeared in the decentralized finance (DeFi) realm, where the total value locked across various protocols increased by 0.17% over the past day, indicating positive inflows amid broader asset declines. CoinMarketCap’s “altcoin season” indicator currently sits at 25/100, showing a slight dip from last week’s peak of 27 but still significantly higher than December’s low of 14, suggesting ongoing optimism within the altcoin market.
One notable exception to the downward trend is TRX, which continues to gain, reflecting a 1.2% increase since midnight.
