Bitcoin price is up less than 0.5 percent in the last 24 hours and is expected to face resistance as it approaches $80,000 levels. Luke Deans, a senior researcher at Bitwise, stated that the major cryptocurrency has reached the cost of short-term investors at this level and that selling pressure may increase if it rises to a price above expectations.
US Federal Reserve and macro developments affect
Another pressure on the markets resulted from the announcement of the US March PCE inflation and the effects of rising oil prices on risky assets. It was reported that especially the rise of West Texas oil to 110 dollars and the decrease in traffic in the Strait of Hormuz increased the fragility in energy markets.
The US Federal Reserve’s (FED) decision to keep the federal funds rate steady also weighed on the course of the market. The fact that four different opinions emerged at the meeting was recorded as the most division since 1992. While one member wanted a rate cut, three regional presidents opposed the FED’s easing message.
Amidst this chaos in the markets, Deans stated that altcoin prices also move closely with bitcoin in the short term, with the 180-day correlation approaching 97 percent and the beta value approaching 99 percent. In other words, many tokens can show value changes similar to Bitcoin’s leveraged movements.
Signs of volatility and risk in market data
While the open position (OI) amount in futures transactions decreased by more than 2 percent to 119 billion dollars in the last 24 hours, the transaction volume increased by 26 percent and reached 208 billion dollars. This situation indicated that position closings and capital withdrawn from the market showed a tendency to avoid risk.
Over $500 million in leveraged positions were liquidated on exchanges, most of which were bullish positions. As the market weakened with the rise in bond yields, many investors were caught off guard.
Open interest in Bitcoin and ether futures decreased by 2 percent and 1.7 percent, respectively. Similar declines were evident in most major assets, but Dogecoin’s open interest remained near its highest level in the last six months.
It has been observed that in most cryptocurrencies except XMR, XLM, TRX and CC, sellers were more dominant than buyers in the last 24 hours and the total volume was on the negative side. This chart gave signs that prices could fall further.
Options market and campaign updates
Bitcoin’s 30-day options volatility index BVIV fell as much as 41 percent, continuing its decline since the 97 percent peak reached in February. This data indicates that the market’s sensitivity to negative macro developments such as rising bond yields and rising oil prices has decreased. The volatility index on Ethereum showed a similar trend.
The cost of protective put options on Deribit remains higher than bullish call options. It is stated that the high open position at $ 80,000, especially for bitcoin, may trigger selling pressures in the market and market makers may meet the increases at these levels with sales for hedging purposes.
When the option maturity structure is examined, it is seen that although a decrease in stress is observed in the short term, forward-looking uncertainty is priced in. Additionally, Amberdata data showed that a large bitcoin put spread spanned the $72,000 and $65,000 levels, reflecting an expectation of a decline in prices again towards $65,000.
On the other hand, the platform called Pump.fun, which operates in the memecoin market, introduced a new feature that can send some of the transaction fees generated by projects to verified charities. The largest campaign currently running on the donation platform is St. Raised $12,800 for St. Jude Children’s Hospital.
The platform also announced that, starting today, it will stop using all its income to buy and burn PUMP tokens, and will automatically allocate 50 percent of net income to buyback and burn for the next year, and use the rest in recruiting, product development and marketing.
Beneath the surface of the market, conditions are occurring that are typically seen during periods of increased volatility. Liquidity is still weak and profit-loss transactions mainly offset each other, indicating uncertainty about direction.
While PUMP lost more than 7 percent of its value in the last 24 hours, a 2.2 percent decrease was observed in the CoinDesk 20 index (CD20).
