BTC

ETH

S&P Futures 500

$19,039

$1,284.50

$3,665.75

(+0.50%)

 (+0.75%)

(-0.64%)

Note: All percentages shown above are referenced to the previous business work day's 09:00 (GMT+8)


GM Treehouser 🌳

Welcome to our Treehouse Daily newsletter (previously known as The Canopy Collective), where Treehouse brings you financial news and insights free daily! We believe you’ll find this helpful.

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Our Daily View

What We Are Covering Today

  • UK prime minister Liz Truss resigned 6 weeks into the job; US unemployment claims came in lower than expected (more in Macro & TradFi)
  • Possible BitBTC bridge exploit spotted by Arbitrum tech lead (more in DeFi & CeFi)
  • Number of addresses holding 1 or more ETH just reached an ATH (more in On-Chain)
  • Vol sellers still aggressively pushing near-dated vols lower; VIX dipped below 30 for the first time in two weeks (more in Crypto Derivatives)
  • BTC and ETH retest key support levels amidst lackluster price action (more in Crypto Technical Analysis)

Macro & TradFi

GM! UK's Liz Truss announced her resignation as prime minister just six weeks into the job, brought down by an economic program that had sent shockwaves through global financial markets. Former PM Boris Johnson was reported to be entering the race for the post again. Wall Street's main indexes reversed early upside and closed in the red as the U.S. central bank is likely to deliver its fourth straight 75 basis-point hike in its November meeting. Unemployment claims fell to 214K unexpectedly on Thursday, pointing to a tight labor market.

US indices had a 3rd consecutive red day again amid rising treasury yields and no real signs of inflation slowing down. S&P500 fell by 0.92% and the Nasdaq dropped by 0.84% while the DJI lost 0.42%. US10Y Government bond yields surged up to 4.23% as bond bulls kept capitulating. USDJPY sits above 150, registering ~33% YTD loss for JPY as carry trades between JPY yields and dollar rates become increasingly profitable due to the widening rates differential. WTI Crude Oil remained flat, moving up only 0.14% to $85.00 after testing its $87.00 high earlier in the day.

DeFi & CeFi

  • DeFi TVL down 2.40% over past 24hours
  • Cross-chain bridge BitBTC alerted by Arbitrum tech lead of potential exploit
  • MetaMask launches SDK in public beta
  • Binance CEO says that delegation of 13M UNI tokens was unintended due to an internal wallet transfer
  • Coinbase to waive commission fees for onboarding or offboarding of USDC via any fiat currency
  • Celestia raises $55m in series A and B rounds

BitBTC, a cross-chain bridge that supports transfers between Optimism and BitAnt, was alerted of a potential vulnerability in its bridge by Arbitrum tech lead Lee Bousfield on Twitter. The reported vulnerability would have allowed an attacker to mint fake tokens on one side of the bridge and swap them for real ones on the other. The bug has since been patched 10 hours after the tweet was released.

On-Chain

For on-chain, ETH balance on exchanges just reached a 1-month low of 21,163,136 ETH. In addition, Number of addresses holding 1 or more ETH just reached an ATH of 1,597,467. Both metrics indicate that investors are continuing to accumulate and hold ETH for the long-term.

Crypto Derivatives

  • Funding rate remains negative for both BTC and ETH perps
  • 30-day IV rose slightly for both BTC and ETH to 54.2% and 68.3%, respectively
  • 30-day 25d put skew tightened for both BTC and ETH to -6.71% and -7.58%, respectively

Total liquidations for futures totaled $60M on Thursday, of which $46M were long liquidations.

On the options front, both 7-day IV and RV on BTC dropped further, converging at least once. It seems like traders are still aggressively selling vols even at such levels to take advantage of the lack of price movements in the underlying.

On the flow side, there was an interesting but massive size of 500 contracts of BTC-29SEP23-22000C being bought. The trade was executed at an IV of 65%, and is very likely the trader is expressing a long vol trade instead of an outright directional bet given that the option expires in about a year's time, where vega is higher. Other than that, long straddle still remains the top structure traded within BTC, while short strangles came in second.​​

Lastly, the VIX dropped below 30 for the first time in two weeks as broader indices such as the S&P 500 had only moved 0.67% for the past five days, showing signs of falling realized volatility.

Crypto Technical Analysis

Looking at TA, BTC saw a drawdown yesterday after attempting to break above 19.3K. Price has seemed to find support again at $18,983 again. Looking at the weekly candle, should BTC close below $19,262, a second red weekly candle would be printed. Traders should watch if price closes above the $18,983 level as a break below may signal continued downside.

For ETH, price action looks lackluster as it has come to retest the $1280 level after failing to reclaim $1.3K. RSI doesn’t seem to show any signs of directional bias however, weekly closes below $1280 may show continued downward movement, while a close above would suggest continued consolidation. A close above the weekly candle open of $1305 would signal renewed bullish strength.

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Yours sincerely,
Treehouse Research 🌳

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