BTC

ETH

S&P 500 Futures

$106,100.50

$3,882.75

$6,126.75

(+0.25%)

 (-1.91%)

(-0.28%)

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

GM 🌳

Welcome to the TRHX Pulse newsletter (formerly Treehouse Daily), where TRHX delivers your daily dose of financial news and insights for free! We believe you'll find it both informative and valuable.

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November 2024 Market Recap

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Our Daily View

What We Are Covering Today

  • Nissan and Honda explore merger to take on Toyota; Biden to investigate Chinese semiconductors (More in Macro & TradFi)
  • Wormhole and Nuffle Labs expand EigenLayer's restaking beyond Ethereum; Ohio proposes Bitcoin reserve to safeguard treasury funds (More in DeFi & CeFi)
  • ETH foundation sold 100 ETH recently for $420K; Whales depositing into Hyperliquid to buy HYPE and PURR (More in On-Chain)
  • BTC’s ATM IVs and skews indicate neutral market sentiment; BTC term structure remains in backwardation (More in Crypto Derivatives)
  • BTC tests upper trendline of ascending wedge; ETH shows neutral momentum with some signs of weakness (More in Crypto Technical Analysis)

Macro & TradFi

Honda and Nissan are exploring a potential merger, aiming to strengthen their position in the global automotive industry and compete more effectively against the world’s largest carmaker, Toyota. This move follows their earlier collaboration on electric vehicle (EV) batteries and software, with Honda CEO Toshihiro Mibe hinting at a possible capital tie-up. The proposed merger could create a major player to rival Tesla and other EV manufacturers, especially as both companies face financial struggles. Honda's market valuation is significantly higher than Nissan's, but combining the two would still fall short of Toyota’s size. The merger could help Nissan overcome its financial challenges and strengthen its position, while also allowing the combined entity to challenge Toyota in both domestic and international markets. However, the deal faces challenges, including potential overlap in operations and resistance within Nissan’s leadership.

In other news, the Biden administration is set to launch a trade investigation into Chinese semiconductors in an effort to reduce reliance on technology that U.S. officials believe could pose national security risks. This investigation could lead to tariffs or other measures to limit imports of older-model semiconductors and related products. The probe, expected to take several months, will likely extend into President-elect Donald Trump’s administration, giving his team the authority to impose restrictions on semiconductor imports early in his term. This move aligns with Biden's push to bolster the U.S. semiconductor industry by limiting Chinese competition in foundational chip markets and promoting domestic production through financial incentives. Biden has already implemented export restrictions on advanced U.S. technology and has raised tariffs on Chinese semiconductors, but concerns remain about the impact of inexpensive Chinese chips flooding the global market. This investigation is seen as part of a broader strategy to protect U.S. industries and strengthen semiconductor manufacturing within the country.

On December 17, 2024, U.S. stocks declined as investors awaited the Federal Reserve’s rate decision. The Dow Jones Industrial Average fell 0.6%, marking its ninth straight daily loss—the longest such streak since 1978—while the S&P 500 slipped 0.4% and the Nasdaq eased 0.3%. Tech stocks were mixed: Nvidia lost 1.2%, continuing its pullback, while Broadcom fell 3.9% after recent gains. Tesla rose 3.6%, bucking the trend amid optimistic analyst upgrades tied to a potentially EV-friendly Trump administration. Health care faced ongoing pressure after remarks on cutting out drug middlemen, with Humana plunging 10.2%. Pfizer climbed 4.7% on in-line guidance for 2025, and Fox gained over 4% on strong viewership metrics. The 10-year Treasury yield held at 4.40%, Bitcoin hovered near $106,000 after hitting a fresh record, and gold and oil edged lower. The market’s focus now turns to the Fed’s policy announcement on Wednesday, widely expected to include another rate cut.

DeFi & CeFi

  • Wormhole, EigenLayer and Nuffle Labs partner to bring restaking beyond Ethereum
  • Ohio lawmaker introduces Bitcoin reserve bill allowing state to buy BTC
  • Pudgy Penguins PENGU Token Debuts and currently at $2.3B Market Cap
  • Stablecoin Payments Platform BVNK Raises $50M to Fuel U.S. Expansion
  • Trump meets with Crypto.com CEO as firm drops SEC lawsuit
  • Tether invests in European stablecoin issuer StablR

Wormhole, EigenLayer, and NEAR-focused Nuffle Labs have partnered to extend EigenLayer's restaking capabilities beyond Ethereum. By integrating Wormhole’s cross-chain messaging system and Nuffle's NUFF protocol, this collaboration eliminates the need for asset bridging, enabling restaking directly across various Layer 1 and Layer 2 blockchains. Restaking protocols like EigenLayer allow applications to share the security of staked assets, improving efficiency and reducing the need for dedicated security infrastructures. This advancement could unlock new blockchain use cases, such as enhanced Layer 2 security, data availability, and oracles for smart contracts. The partnership also integrates Nuffle's modular NEAR technology, making tokens restaked via its infrastructure accessible to EigenLayer’s actively validated services (AVSs). 

In other news, Ohio House Republicans leader Derek Merrin has introduced the Ohio Bitcoin Reserve Act (HB 703), proposing that the state treasury be authorized to invest in Bitcoin as part of its asset allocation strategy. This makes Ohio the third state, after Texas and Pennsylvania, to consider holding Bitcoin in its treasury. Merrin argues the move could protect state funds from the devaluation of the U.S. dollar and position Ohio to benefit from Bitcoin’s transformative impact on finance. Although introduced late in the legislative session, the bill is intended to serve as a framework for swift reintroduction in the 136th General Assembly starting January 2025.  

On-Chain

An analysis by Lookonchain showed that the Ethereum Foundation has sold 100 ETH, valued at approximately $420.47K, in its latest transaction. This brings the total ETH sold by the Foundation this year to 4,466 ETH, worth approximately $12.62M. Such periodic sales by the Foundation are often interpreted as strategic moves to fund operational expenses or diversify assets. While not inherently bearish, these transactions can impact short-term market sentiment, as they signal potential profit-taking during price rallies. Monitoring further sales will help gauge any patterns related to key market movements or broader Ethereum ecosystem developments.

An on-chain analysis by Lookonchain found that whales are actively depositing significant funds into Hyperliquid to acquire $HYPE and $PURR, reflecting strong investor confidence in these tokens. Wallet 0x0013...5D22 deposited 9.66M USDC, purchasing 166,913 HYPE worth $4.8M and 6.48M PURR worth $4.14M, while wallet 0xCA97...651E deposited 4.26M USDC, buying 125,252 HYPE worth $3.57M and 1.88M PURR worth $1.19M. This substantial capital inflow indicates growing interest and demand for these assets, which often signals potential price momentum and increased volatility. Traders should closely monitor this activity as it may present short-term opportunities or emerging market trends.

Derivatives

  • The funding rate for BTC and ETH remained positive.
  • Deribit Implied Volatility Index (DVOL) for BTC and ETH remained flat at 59.10 and 71.93 respectively.
  • The 30-day 25-delta skew (C-P) for BTC and ETH dropped slightly to 1.22 and 1.04 respectively.
  • The futures market witnessed $318.90M in liquidations over the past 24 hours with 73.14% representing longs.

Net Annualized APR

Perp (USDT pair)

Long on

Short On

7.97%

AVAX

OKX

Binance

5.78%

BNB

Binance

OKX

5.46%

ADA

OKX

Bybit

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.

In the past day, BTC’s 7-day ATM IV has declined, indicating a drop in short-term volatility expectations, while the 30-day ATM IV has remained relatively steady. This divergence highlights a shift in market sentiment, with short-term traders appearing more confident about reduced near-term risks, while medium-term participants maintain a consistent outlook, possibly anticipating further catalysts or sustained volatility over the coming month.

BTC's term structure has returned to a contango shape, with short-term IV lower than longer-term IV. This upward slope reflects a reduction in near-term uncertainty, as traders expect lower volatility in the immediate future coherent with BTC’s IV levels.

Over the past day, BTC’s 7-day skew has trended downward, indicating a growing preference for puts over calls in the short term. Meanwhile, the 30-day skew has remained relatively stable, maintaining a slight upward bias that reflects balanced or slightly call-dominated sentiment for medium-term options. 

Lastly, @Paradigm highlighted notable BTC and ETH trades. For BTC, significant activity included the purchase of a 600x 3-Jan-25 $100K Put, the sale of a 562x 27-Dec-24 $100K/$110K Bull Risk Reversal, and the sale of a 345x 28-Mar-25 $100K/$130K Call Spread. For ETH, major trades included the purchase of a 2000x 20-Dec-24 $4500 Call and a 2000x 27-Dec-24 $3800/$3500 Put Spread. These trades reflect a mix of hedging and directional plays across different maturities.

Crypto Technical Analysis

BTC is testing the upper trendline of the ascending wedge channel at $106.3K, where a break above this level could see BTC targetting $110K. The channel's lower boundary provides support of around $97.7K, representing an 8% decline. The price is retreating from the upper Bollinger Band towards the middle band SMA, and a bounce from this level could help maintain the bullish trend. The RSI has pulled back slightly from overbought conditions to 63.74, suggesting that BTC could face a correction if the buying pressure weakens.

The price movement of ETH shows that it is currently trading in a consolidation pattern over the short term, with the resistance level at $4K and the support level at $3.5K. The price level is at $3.8K and ranges near the lower Bollinger Band where a bounce from this zone would likely signal an upward trend. If the price falls below the lower band, ETH could face further downside pressure. The RSI level is at 44.26, indicating a neutral momentum but showing some signs of weakness.

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TRHX Research (Formerly Treehouse Research) 🌳