The crypto market is trading back on familiar territory on Friday after a short-lived spike to the highest point since early February.
Bitcoin is trading a hair under $75,000, while ether ($ETH) is at $2,300, both significantly lower than Friday’s highs of $78,300 and $2,460.
One reason for traders to be bullish is that the Bitcoin futures market on the CME, a venue favored by institutions, closed at $77,540 on Friday and opened at $74,600, creating a “CME gap” that extends 3.8% to the upside. A similar gap occurred last week and was filled before the end of the day on Monday.
The first steps have been taken: Bitcoin is up 1.5% since midnight UTC, suggesting sentiment is warming up after a volatile weekend.
The market plummeted over the weekend as shipping through the Strait of Hormuz came to a standstill after it opened on Friday. The renewed shutdown led to a rise in crude oil prices from $78 to $88 per barrel.
This weighed on risk assets, with futures on the Nasdaq 100 and S&P 500 both down 0.59% since midnight.
Positioning of derivatives
- Market-wide, crypto open interest (OI) remained stable at around $120 billion over the past 24 hours. In contrast, trading volume increased by 30%, indicating an increase in activity without a corresponding increase in new positions. That may indicate higher turnover, short-term positioning or traders rotating risk instead of deploying fresh capital.
- OI in solana (SOL), bitcoin, ether ($ETH) And $XRP ($XRP) remained largely stable. The OI in HYPE futures fell 3% as the price fell, indicating capital outflows. Elsewhere, OI in AVAX and SP 500 perpetuals rose 6% to 10%, respectively.
- OI in $AAVE futures soared to a record high of 3.46 million tokens as collateral damage from KelpDAO’s weekend exploit led to rapid withdrawals from the Aave lending platform.
- Financing rates linked to $BTC, $ETH and several other tokens turned negative, indicating a bias toward short positions that would benefit from a price drop in these tokens.
- $BTC And $ETH Options on Deribit remain more expensive than calls, signaling continued downside concerns.
- Block currents showed bias for $BTC call spreads, which are directional bets, and ether straddles, a volatility play.
Token talk
- The altcoin sector was rocked this weekend by an exploit of Kelp DAO’s $292 million rsETH token, leading to contagion risks in the DeFi market.
- Total Value Locked (TVL) on Aave fell from $26.5 billion to $17.5 billion as a result, with the exploit raising fears that bad debt would hit Aave’s WETH pool, causing heavy withdrawals and a liquidity crisis.
- Aave’s sign, $AAVErose 2.2% on Monday, after falling 22% on Saturday.
- The bitcoin-dominant CoinDesk 20 (CD20) Index rose 1% on Monday, outperforming the altcoin-weighted CoinDesk 80 (CD80) and the DeFi Select Index (DFX), which rose 0.6% and 0.9%, respectively.
- One particularly volatile token is celestia (TIA), which remains down 3.9% over the past 24 hours even after rising more than 4% since midnight.
- CoinMarketCap’s “Altcoin Season” indicator is at 36/100, showing investor preference for bitcoin after Friday’s short-lived breakout.