BTC

ETH

S&P Futures 500

$70,690.50

$3,820.25

$5,309.75

(+2.45%)

 (+1.63%)

(+0.14%)

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


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Our Daily View

What We Are Covering Today

  • US job openings reach lowest level since Feb 2021; India Prime Minister Modi loses majority votes in the lower house of Parliament (More in Macro & TradFi)
  • Tether CEO expressed concerns over MiCA; FTX reaches a deal with the SEC on the tax dispute (More in DeFi & CeFi)
  • Short-term holders supply pressure spikes at previous ATH; Both Short and Long-term holders supply in losses (More in On-Chain)
  • Bitcoin option traders anticipate heightened near-term volatility; focus remains on near-dated options (More in Crypto Derivatives)
  • BTC breakouts from $70K physiological barrier; ETH RSI approaching overbought zone (More in Crypto Technical Analysis)

Macro & TradFi

In April, U.S. job openings saw a greater-than-expected decline, reaching their lowest level since February 2021, according to the Labor Department's JOLTS report. With 8.059 million job openings, the ratio of job seekers to openings dropped to 1.24, the lowest since June 2021. This signals a potential normalization between labor supply and demand, presenting a challenge for the Federal Reserve in balancing inflation control with labor market stability. The decline in job openings spanned various sectors, with only a few experiencing increases. However, indicators such as the number of people quitting their jobs and layoffs suggest a resilient labor market. 

Elsewhere, Indian Prime Minister Narendra Modi's Bharatiya Janata Party (BJP) fell short of an outright majority in India's lower house of Parliament, winning only 240 seats out of 543. As a result, Modi is required to seek power-sharing agreements for his historic third term, as the BJP will have to rely on smaller allies within the BJP-led National Democratic Alliance (NDA) to form a government. The opposition, led by the Indian National Congress, performed better than expected, winning 233 seats. Despite Modi's declaration of victory, the reduced majority raises questions about his popularity and could hinder immediate policy implementation. Economic concerns, including rising unemployment and inflation, have affected voter sentiment. The market reacted negatively to the news, with benchmark indexes plunging 8%. 

Lastly, U.S. stocks closed higher on Tuesday despite a slow start, spurred by a report indicating a cooling labor market. The Dow Jones Industrial Average rose 0.4%, while the Nasdaq Composite and the S&P 500 each advanced 0.2%. Cruise operators and REITs led the S&P 500, with Carnival Corp surging 5.8% and Extra Space Storage gaining 2.2%. However, Bath & Body Works plummeted 13.3% on disappointing guidance. Tech stocks saw mixed performances, with Cisco climbing 1.7% after announcing an AI fund, while semiconductor stocks like Marvell Technology and Advanced Micro Devices faced losses.

DeFi & CeFi

  • More than $1M stolen from a single user on Binance due to a Chrome plugin
  • Chainlink highlights the importance of decentralized oracles following the NYSE glitch
  • SingularityNET announces ASI token merger dates
  • MicroStrategy and Michael Saylor settle tax case for $40M
  • Australia’s first spot BTC ETF is set to launch on Tuesday.

Tether CEO Paolo Ardoino expressed concerns about the European Union's Markets in Crypto-Assets Regulation (MiCA), stating that it contains several problematic requirements that could complicate the job of stablecoin issuers and increase the risk for EU-licensed stablecoins. His comments follow Binance's announcement of restrictions on "unauthorized" stablecoins in Europe, prompting questions about the impact of MiCA on stablecoin accessibility. While Binance clarified that it won't delist unauthorized stablecoins but will limit their availability for European users, other exchanges like OKX and Kraken are also considering MiCA's potential impacts. Ardoino highlighted ongoing discussions with regulators regarding concerns about capital reserves, emphasizing the importance of maintaining reserves in treasury bills to mitigate risks. Despite engagement with exchange counterparts in Europe and optimism about MiCA's implementation, Ardoino stressed the need for balanced regulatory policies that protect consumers and foster industry growth. 

In other news, FTX, the bankrupt crypto exchange, has reached a tentative agreement with the IRS to settle a $24-billion tax dispute, with the IRS initially claiming over $44 billion. The settlement, contingent on court approval of FTX's reorganization plan, includes a $200 million payment to the IRS within 60 days of approval, with an additional $685 million as a subordinated claim. This agreement covers tax claims until October 31, 2022, reducing litigation risk and increasing certainty for creditors and customers. FTX acknowledges owing taxes but disputes the amount and specific reasons, including misappropriated funds by its former CEO and disagreements over employment taxes and deductions. The exchange has proposed a new plan to fully reimburse creditors, with eligible claims under $50,000 receiving a 118% recovery based on asset values at the time of FTX's collapse in November 2022.

On-Chain

Recent on-chain data from Glassnode shows that the Entity-Adjusted Unspent Realized Price Distribution (URPD) reveals a dominant presence of Long-Term Holders (LTH) in the market, particularly as Bitcoin nears its all-time high. Notably, there is a substantial cluster of coins held by Short-Term Holders (STH) acquired near the current price level, indicating recent significant investment within this price range. This accumulation by STHs, occurring close to the previous cycle’s ATH. 

Further analysis from Glassnode shows a stark contrast in behavior between Short-Term Holders (STH) and Long-Term Holders (LTH) of Bitcoin. As the market experienced a pullback to $58,000, marking a 21% correction—the largest since the FTX collapse—56% of STH supply fell into loss. This equates to 1.9 million BTC shifting into a loss position. Despite this, the magnitude of unrealized losses aligns with typical corrections observed in bull markets. In contrast, LTH supply experiencing losses is negligible, with only 4.9k BTC or 0.03% of LTH supply being in loss, mostly from those who purchased at the peak of the 2021 cycle and have held on.

Derivatives

  • Funding rates remained positive for BTC and ETH.
  • Deribit Implied Volatility Index (DVOL) for BTC and ETH remained relatively unchanged at 54.57% and 64.88%.
  • The 30-day 25-delta skew (C-P) for BTC decreased to 1.73% while ETH dipped slightly to 3.66%.
  • The futures market witnessed $97.46M  in liquidation, with shorts representing 63.13%.

Top 3 USDT Perpetual Funding Rate Arbitrage Opportunities

Net Annualized APR

Perp (USDT pair)

Long on

Short On

27.77%

BNB

Bybit

OKX

25.92%

BNB

Binance

OKX

16.60%

DOGE

Bybit

dYdX

Notes:

1) Pairs observed include BTC, ETH, SOL, BNB, XRP, LTC, and DOGE vs. USDT perps. 

2) CEXs observed include Binance, Bybit, OKX & dYdX.

3) Lookback period is 24 hours.


Bitcoin's 7-day ATM implied volatility (IV) increased to 51.45%, while the 30-day ATM IV rose to 53.70%, reflecting traders' expectations of heightened volatility following BTC surpassing the $70K mark. This rise in IVs indicates that option traders are preparing for significant price fluctuations in the near term.

BTC's term structure remains in contango, with notable activity in tenors up to 30 days, which have again seen an increase from the previous day. This trend indicates that BTC option investors are predominantly focusing on purchasing near-dated options to try to capitalize on the short-term volatilities.

Furthermore, BTC's 25-delta skews have increased significantly over the past day, with the 7-day skews decreasing to 2.22%, while the 30-day delta skews dipping to 1.73%. Despite the dip, the skews still remain largely positive, suggesting that option investors still hold an optimistic outlook on BTC’s trajectory.

Lastly, @Paradigm’s option flows from yesterday emphasized strategies consisting of call and put spreads. Key BTC trades encompassed the procurement of 817x 21-Jun-24 78k/82k Call Spreads, 275x 6-Jul-24 67k/65k Put Spreads, and a singular transaction that involved the sale of 223x 28-Jun-24 70k / 26-Jul-24 75k Call Calendars. Key ETH trades featured 2500x 14-Jun-24 4200 Calls, 2250x 28-Jun-24 3000 Puts, and a notable trade involving 2200x 26-Jul-24 3600/3400 Put Spreads.

Crypto Technical Analysis

Moving on to technical analysis, building on yesterday’s bullish breakout, today’s daily chart highlights continued positive momentum, with BTC now trading around $70.89K. The Relative Strength Index (RSI) has risen to 63.17, moving further into the upper half of the neutral zone and edging closer to overbought territory, which underscores the increasing buyer interest. BTC is challenging the critical resistance at $71K, with any sustained break above this level potentially opening the path towards the $73K mark, indicated by the upper Bollinger Band. The current price is also well above the 50-day moving average (blue line), which supports the bullish trend. If BTC fails to hold above $71K, the previous resistance at $68.2K could act as the new support level, helping to stabilize prices before the next upward move. 

ETH is currently trading around $3.8k, with the market currently experiencing a slight increase from the previous support. The Relative Strength Index (RSI) is at an elevated level of 60.27, as compared to previous days of consolidation around the neutral zone of 50, which further supports the bullish price movements of ETH. Should ETH continue on its current trajectory, it may face resistance at $3.95K level. Conversely, ETH has a support level at $3.6K should it fail to sustain its current momentum. 

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