BTC

ETH

S&P 500 Futures

$71,308.00

$2,492.25

$5,843.00

(+4.86%)

 (+3.82%)

(+1.79%)

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

GM 🌳

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October 2024 Market Recap

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Our Daily View

What We Are Covering Today

  • NVDA surpasses AAPL in market capitalization; China’s central bank pledges monetary policy support to boost its slowing economy (More in Macro & TradFi)
  • Swift-UBS completes MAS pilot; VanEck launches Pyth-based ETN (More in DeFi & CeFi)
  • Mt. Gox BTC transfers may impact market liquidity; Ethereum derivatives inflows suggest upcoming price volatility (More in On-Chain)
  • BTC’s IV spikes amid election; Skew reflects mixed sentiment as hedging demand rises (More in Crypto Derivatives)
  • BTC holders rally to push past $70K psychological level; ETH price and RSI level rebound to signal shift in momentum (More in Crypto Technical Analysis)

Macro & TradFi

Nvidia has surpassed Apple to become the world's largest company by market capitalization, now valued at $3.43 trillion compared to Apple's $3.38 trillion, reflecting the company's dominance in the artificial intelligence (AI) sector. Shares of Nvidia rose 2.9% to $139.93, marking a staggering increase of over 850% since the end of 2022. Nvidia’s milestone showcases the significant influence of AI on Wall Street, with the chip manufacturing company being the biggest beneficiary of the ongoing AI infrastructure boom. The company's performance has notably contributed to the S&P 500's gains this year, accounting for about 7% of the index's weight and roughly a quarter of its 21% increase. Major tech firms, including Microsoft and Amazon, remain heavily invested in AI, with Nvidia among their largest suppliers. Analysts predict Nvidia's revenue will double this fiscal year and continue to grow substantially, driven by strong AI demand and effective Blackwell chip production management.

Elsewhere, the People's Bank of China (PBOC) reaffirmed its commitment to a supportive monetary policy during a recent meeting, with Governor Pan Gongsheng emphasizing plans to intensify counter-cyclical monetary measures to address short-term economic challenges. This statement comes as the central bank seeks to bolster the slowing economy, which has been affected by various factors, including a drop in land sale revenues and hidden debt. Finance Minister Lan Fo'an also addressed the National People's Congress Standing Committee, discussing proposals to increase local government debt limits to replace concealed debts. The PBOC has been actively cutting interest rates since late September to stimulate growth, aligning its policies with the easing measures of the U.S. Federal Reserve.

On November 5, 2024, U.S. stocks surged as investors anticipated the outcome of the presidential election and the Federal Reserve's rate decision. The S&P 500 and Nasdaq rose 1.2% and 1.4%, respectively, while the Dow gained 1%. Tech stocks led the rally, with Nvidia up 2.8% and Palantir soaring 23.4% on strong earnings and AI-driven demand. Intel climbed 3.6%, recovering from Monday's losses, while Boeing fell 2.6% despite the end of a machinists' strike. The 10-year Treasury yield decreased to 4.28%, and crude oil rose 1% on OPEC+ output cuts. Celanese led decliners, plummeting 26.3% on weak earnings and a dividend cut, while Wynn Resorts and Archer-Daniels-Midland also fell significantly. The Fed's interest rate decision will take place on Friday, 8 November, at 03:00 SGT.

DeFi & CeFi

  • Swift, UBS and Chainlink complete pilot under MAS
  • VanEck expands European reach with PYTH-Based ETN
  • Polymarket to delay payout until Fox and NBC agree on Election winner
  • ETH/BTC sees record low since April 2021
  • Meta opens Llama AI model up to US military

Swift, UBS Asset Management, and Chainlink completed a pilot under Monetary Authority Singapore’s Project Guardian to streamline tokenized fund settlements using blockchain. By leveraging Swift’s vast network, the initiative integrates traditional fiat payment systems with blockchain-enabled tokenization without necessitating blockchain-exclusive payments. Project Guardian aims to reduce inefficiencies in fund transactions, such as redemptions and subscriptions, by enabling real-time, automated processing that reduces operational costs and enhances liquidity. UBS also introduced a tokenized money market fund, “uMINT”, on Ethereum. 

In other news, VanEck has launched a new exchange-traded note (ETN) on the Pyth Network, now listed on Euronext Paris and Amsterdam, aiming to expand its presence in the European crypto investment market. This PYTH-based ETN leverages decentralized oracle technology to provide exposure to DeFi's potential growth. While the ETN is not an ETF, it tracks the MarketVector Pyth Network VWAP Close Index, indirectly reflecting PYTH’s value. Priced with a 1.5% expense ratio, the ETN includes a volatility warning, underscoring its high-risk profile. This launch aligns with VanEck’s recent moves to broaden its crypto asset offerings, including a venture fund for crypto startups and a Solana staking partnership.

On-Chain

Moving on to on-chain analysis, Mt. Gox has transferred 32,871 BTC (valued at $2.2 billion) to three new wallets, with portions reaching exchanges like OKX and B2C2. On-chain data from Spot on Chain highlights the concentration of remaining funds, with Mt. Gox wallets still holding approximately 12,006 BTC ($810 million). While the July distribution of 59,000 BTC saw limited sales activity among creditors—many opted to hold rather than liquidate—current transfers into CEXs suggest that this distribution may have a more immediate impact on market liquidity and Bitcoin’s circulating supply.

In another analysis by CryptoQuant, there has been a substantial inflow of Ethereum to derivative exchanges, with 82,000 ETH moving in a single recent transaction, as indicated by the large green spike in the provided chart. Such a netflow surge often signals heightened trader activity and a potential shift in market sentiment. Historically, similar spikes in Ethereum inflows to derivative platforms have preceded periods of price volatility, often leading to downward corrections or sharp moves in price.

Derivatives

  • Funding rate for BTC and ETH remained positive.
  • Deribit Implied Volatility Index (DVOL) for BTC and ETH dropped to 60.88% and 64.20% respectively.
  • The 30-day 25-delta skew (C-P) for BTC rose to 3.52 while ETH remained in the negative at -0.43.
  • The futures market witnessed $213.27M in liquidations in the last 24 hours, with shorts representing 65.23%.

Net Annualized APR

Perp (USDT pair)

Long on

Short On

10.95%

BNB

Binance

Bybit

10.48%

BNB

OKX

Bybit

9.09%

XRP

OKX

Binance

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 at-the-money IV remains high at 86.08, while the 30-day IV holds steady at 62.08. This elevated short-term IV indicates that option buyers are bracing for continued volatility, from the election and from potential market impacts of the upcoming Federal Reserve interest rate decision on Friday.

Bitcoin's options term structure is exhibiting steep backwardation, driven by strong demand for short-dated options as traders look to hedge against anticipated election-induced volatility in a cost-effective manner. This demand surge has pushed implied volatility IV for these short-term options to around 120, indicating intense buying pressure.

Bitcoin’s options skew is currently moving in tandem with increasing odds of Trump’s victory, reflecting a bullish sentiment among traders. As Trump’s odds rose to 70% on Polymarket,with the 30-day skew reaching 2.73. However, the 7-day skew has dipped into the negatives as hedgers increasingly buy put options for the US election results and the Fed Interest rate decision.

Lastly, @Paradigm top structures highlighted a mix of instruments for BTC and bearish trades for ETH. Key BTC trades included the purchase of 925x 8-Nov-24 $68K Puts and 400x 29-Nov-24 $85K Calls, showing a mix of downside hedging and high-strike calls. In ETH, notable structures involved the sale of 3042x 8-Nov-24 $2.45K Calls and the purchase of 2000x 6-Nov-24 $2.375K/$2.3K Put Spreads, reflecting a blend of call selling and targeted downside protection through Put spreads.

Crypto Technical Analysis

BTC holders rallied to push the price of BTC above the psychologically critical level of $70K to $71K. It is set to test the immediate resistance level at around $72K whereby if the price breaks above this level, it could pave the way for a test of new highs. The immediate support level is at $68K, representing a potential 4.2% decline from the current price. The RSI is currently at 64.23, approaching the overbought zone but still within a bullish range. Traders should watch for a potential break above the resistance level to confirm further upside potential or a pull-back to support levels.

ETH is currently trading around $2.48K, recovering from a recent drop. This level has previously acted as a support, with the subsequent resistance level at around $2.72K. The RSI has recently rebounded and is now around 52, moving out of oversold conditions and indicating a shift in momentum. This suggests that buying interest has increased and could signal further bullish momentum if the RSI continues its upward trend. Traders should monitor these indicators for any signs of a potential rally toward the resistance level or reversal toward the support level.

Access institutional-grade commentary on TradFi × Crypto markets

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TRHX Research (Formerly Treehouse Research) 🌳