The crypto market experienced a "sell the news" reaction to the Federal Reserve's interest-rate cut and a U.S. trade deal with China, with bitcoin BTC$109,567.70 sliding back to the $110,000 level of support.
Traders will now be wondering whether the recent high just shy of $116,000 will mark a lower high from the record $126,000 bitcoin hit the start of the month, which would indicate the etchings of a downtrend and a reversal.
Bitcoin dominance ticked down a few basis points on Thursday to suggest that some altcoins are outperforming BTC despite market weakness being reflected across crypto majors.
Derivatives Positioning
By Saksham Diwan
- Despite yesterday's post-Fed news price drop in bitcoin, the BTC futures market shows strength: Open interest (OI) has slightly increased to $27.2 billion, confirming minimal liquidations and quick buyer re-entry.
- Crucially, the highly polarized funding rates have normalized, now trending neutral and close-to-flat across most venues. This signals underlying market resilience and a less volatile, more measured sentiment compared with the previous uncertainty.
- The BTC options market maintains a strong bullish lean, although short-term conviction has moderated.
- The implied volatility (IV) term structure still exhibits near-term backwardation before transitioning to long-term contango. The one-week 25-delta skew has dropped to 8% from 10% yesterday, but traders are still paying a significant premium for short-term call options.
- This reduced conviction is reflected in the 24-hour put-call volume ratio, which remains bullish at 55:44 in favor of calls.
- Coinglass data shows $821 million in 24 hour liquidations, with a 79-21 split between longs and shorts.
- BTC ($368 million), ETH ($188 million) and others ($52 million) were the leaders in terms of notional liquidations. Binance liquidation heatmap indicates $109,700 as a core liquidation level to monitor, in case of a price drop.
Token Talk
By Oliver Knight
- More than $80 billion was wiped off the total crypto market cap in the past 24 hours, as traders "sold the news" after the Fed's interest-rate cut and a trade deal between the U.S. and China.
- Bitcoin BTC$109,567.70 and ether ETH$3,881.88, the two biggest cryptocurrencies, are both down 2.5% as they grapple with levels of support. XRP and XLM were the worst performing tokens out of the 20 largest, losing 3.5% and 3.3% respectively.
- Plasma XPL$0.3142 continues to make headlines for the wrong reasons, tumbling 14% in 24 hours to compound an overall loss of 81% since Sept. 28.
- One glimmer of optimism across the altcoin market was TRUMP, the memecoin backed by the U.S. president, which rose by 6.8% after reports emerged that Fight Fight Fight, the company managing the token, is planning to acquire U.S. fundraising platform Republic.
- TRUMP has now risen by 45% this week although at $8.40 it remains well below its record high of $45.47.
- Bitcoin dominance ticked down slightly from 59.3% to 59.0%, suggesting that some altcoins are outperforming bitcoin during this latest period of sell pressure.
