Bitcoin's Tight Trading Range
Bitcoin has been trapped in a tight trading range between $69,000 and $71,700 for the past 48 hours, trading recently around $70,100. This comes despite continued conflict in the Middle East that pushed oil back toward $100 per barrel after a sixth ship was reportedly attacked by Iran on the Strait of Hormuz.
Rising open interest hints at bearish bets (Sean Benesh on Unsplash/Modified by CoinDesk)
Derivatives Positioning Tells a Bearish Story
Crypto futures open interest (OI) has increased by 2% to $102 billion in the past 24 hours, with bitcoin and ether OI rising by 2% and 4% respectively. However, the real story lies in the details:
- Annualized perpetual funding rates and cumulative volume delta (CVD) have remained flat to negative
- This suggests the recent build-up in open interest is being driven more by defensive, bearish positioning than by aggressive long-side bets
- On Deribit, bitcoin and ether put options continue to trade at a premium to call options, with notable interest in the $20,000 put option
- Bitcoin and ether's 30-day implied volatility indices (BVIV and EVIV) remain steady despite renewed overnight rally in oil
Altcoins Show Relative Strength
While bitcoin remains range-bound, altcoins are showing relative strength despite a risk-off environment in global markets:
- Decentralized finance (DeFi) token SKY posted a 7.6% gain over the past 24 hours
- AI-focused bittensor (TAO) is up by around 4.5%
- Hyperliquid's HYPE token gained 9% in 24 hours, extending its recent bull run
- The altcoin-heavy CoinDesk 80 (CD80) Index added 2.5% while the bitcoin-heavy CoinDesk 5 (CD5) is up by only 0.9%
One exception has been midnight (NIGHT), which dropped 10% after Tuesday's Binance listing gave holders an off-ramp to sell.
Market Context and Outlook
U.S. stock futures continued to show weakness with the Nasdaq 100 and S&P 500 index futures both losing around 0.6% overnight. The Dollar Index (DXY) moved back toward 100 after Wednesday's CPI figures, putting a stop to any potential rate cuts.
The altcoin market's next move depends on whether bitcoin can break out of the current range with a move above $74,000. A breakout on convincing volume followed by consolidation would likely lead to rotation into more speculative altcoins.
Activity in tether gold (XAUT) continues to cool, with futures OI slipping to the lowest since Feb. 28, showing that gold-linked assets are slowly falling out of favor as the rally in spot gold stalls.
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