After Bitcoin, crypto market sentiment was lively on Monday It rose to $93,350, its highest level since Dec. 11, before giving back some of its gains.
Most of the move occurred at midnight UTC, around the time Bitcoin futures trading opens on the CME exchange, which created a “gap” between $90,500 and $91,550.
These gaps usually fill within a few days, which means the price could return to the $90,500 level at some point this week.
Traders are primarily focused on Bitcoin, rather than altcoins, with the industry’s largest asset up 1.33% since midnight, while the CoinDesk Meme (CDMEME) and Metaverse (MTVS) indices have fallen 6.4% and 2.3%, respectively, over the same period.
Stocks and precious metals also rose overnight, signaling a risk-on strategy following recent U.S. actions in Venezuela.
Derivatives positioning
- In the past 24 hours, exchanges liquidated $260 million worth of leveraged cryptocurrency futures bets, most of which were short trades. In other words, leverage is skewed bearish and caught flat-footed by rising prices.
- Open Interest (OI) for BTC, its forks XRP and BNB gained between 2% and 5% in 24 hours, while ETH, SOL, DOGE and ZEC had flat or even negative OI. These different trends suggest that investor risk appetite has only improved for a few coins.
- Except for BCH, BTC, BNB, and XLM, the OI-adjusted cumulative trading volume increments of the other top 20 tokens have all been negative in the past 24 hours, indicating that there is net selling pressure in the market.
- BTC’s annualized perpetual funding rate has crossed 10%, indicating increasing demand for bullish exposure. Interest rates on several altcoins continue to remain below zero.
- On Deribit, preference for BTC puts has weakened across the board, with traders chasing $100,000 strike calls.
- The block stream features a put spread for BTC and a call spread for ETH.
token talk
- While traders focused on Bitcoin, some coins outperformed the broader market on Monday.
- These include LIT, the native token of newly launched perpetual exchange Lighter, which has gained 3.9% since midnight, while artificial intelligence-focused FET continues its weekend gains, rising 7.4% since midnight.
- Warning signs remain, though, with the cryptocurrency’s average relative strength index (RSI) flashing into “overbought” territory. This suggests that a short-term decline may occur as profit-takers may lock in gains.
- Some coins fail to capitalize on overnight surge: Zcash It is down 2.5% since midnight, while memecoins doge (DOGE) and pepe (PEPE) are down 1.4% and 4.5% respectively.
- The fragmented performance of the altcoin market points to two things: trader indecision and the continued lack of liquidity that have plagued the cryptocurrency market since the October liquidations.
