S&P Futures 500
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 producer prices gained 0.1%, slowest in 3 years; UK economy contracted less than expected (more in Macro & TradFi)
- Landmark Victory for the Cryptocurrency Industry as Ripple Labs scores partial win in SEC court fight over XRP (more in DeFi & CeFi)
- BTC MVRV Z-Score reaches 14-month high of 0.821; BTC NUPL reaches a one-month high of 0.370 (more in On-Chain)
- The market has seen a large amount of short liquidations; Investor preferences changed to short-dated call contracts to profit from near term volatilities (more in Crypto Derivatives)
- BTC, ETH and MATIC experienced considerable surges, indicating bullish breakouts (more in Crypto Technical Analysis)
Macro & TradFi
US producer prices have seen an increase of 0.1% last month, the smallest annual increase since August 2020, indicating a disinflation phase. The rise in monthly PPI was driven by a 0.2% increase in services prices, with notable jumps in deposit services by 5.4%. Goods prices remained unchanged, while energy prices rebounded and food prices declined. These figures reflect the diminishing impact of supply chain bottlenecks and a slowdown in demand for goods due to higher interest rates, pointing towards a fall in inflationary pressures.
On the other hand, the UK economy contracted slightly in May, with a decline of 0.1% in gross domestic product (GDP), which was less steep than what economists have expected. The Office for National Statistics reported that the drop in GDP was influenced by a bank holiday, resulting in lower activity in manufacturing, energy generation, and construction. Overall, services remained flat with less impact from strikes compared to the previous month. The three-month output to April remained unchanged, performing slightly better than the predicted 0.1% contraction. Analysts anticipate a potential downturn in the second half of the year due to higher rates impacting the economy.
In the U.S., the S&P 500 climbed 0.85%, the Dow Jones Industrial Average rose 0.14%, and the Nasdaq Composite gained 1.58%. Asia-Pacific markets mostly rose with Australia's S&P/ASX 200 climbing 0.39%, South Korea's Kospi rising 0.62%, and the Kosdaq gaining 0.37%. Japan's Nikkei 225 increased by 0.84%, while the Topix fell by 0.23%. Hong Kong's Hang Seng index is expected to continue its rally after surging over 2.5% the previous day.
DeFi & CeFi
- Ripple Labs scores partial win in SEC court fight over XRP
- Former Celsius CEO Alex Mashinsky arrested, sued by US DOJ, SEC, CFTC, FTC
- Sui released decentralized Central Limit Order Book DEX, DeepBook
- Polygon proposes upgrading $MATIC to multipurpose token $POL
- TON chain's wallet enables merchants to accept crypto payment on Telegram
- GMX to vote for fee splits plan for GMX v2
Ripple Labs scored a significant legal victory for the cryptocurrency industry as a US court ruled that the company did not violate federal securities law by selling its XRP token on public exchanges. This landmark ruling sent the value of XRP soaring and establishes a precedent for other crypto firms engaged in legal battles with the US Securities and Exchange Commission (SEC). While the ruling pertains to the specifics of this case, it challenges the SEC's jurisdiction over crypto tokens and disputes its assertion that most tokens are securities. Following the news, shares of Coinbase surged over 24%, bolstering its position in an ongoing legal dispute with the SEC.
Although Ripple's win marks a milestone for the crypto industry, the SEC also scored a partial victory. The judge determined that Ripple violated securities law by directly selling XRP to sophisticated investors, necessitating a trial to address the executives' involvement in these sales. The court found that Ripple's sales to institutional investors constituted unregistered securities sales, emphasizing the speculative nature of XRP and its dependence on the company's blockchain development efforts.
Shifting our attention to on-chain, BTC MVRV Z-score just reached a 14-month high of 0.821. The last time these levels were observed was prior to the Terra debacle in May last year. The MVRV Z-Score indicates whether Bitcoin is currently overvalued or undervalued compared to its perceived "fair value". On a longer time-frame, when the MVRV Z-score enters the green zone over a longer period, it typically suggests that BTC often reaches a bottom point, where its market value is considerably lower than its realized value.
On a similar note, as BTC experiences upward momentum due to the XRP lawsuit news, the Net Unrealized Profit and Loss (NUPL) has reached a one-month high of 0.370. This level is slightly higher than the previous one-month high of 0.369 recorded on 23 June. The NUPL is calculated as the disparity between relative unrealized profits and relative unrealized losses. At present, the NUPL is fluctuating within the 'Optimism' range, indicating an upward trend where BTC spot prices historically tend to precede further upward movements.
- Funding rates turned positive for both BTC and ETH
- Deribit Implied Volatility Index (DVOL) rose significantly to 45.04% and 47.28% for BTC and ETH respectively
- 30-day 25-delta skew (C-P) for BTC and ETH is at 3.73% and 5.19% respectively
- The futures market witnessed $255M worth of liquidations, with short positions representing 75.7% of the total.
Top 3 CEX USDT perp funding rate arbitrage based on the last 24-hour lookback:
Net Annualized APR
Perp (USDT pair)
Source: @CexyArbBot Telegram
1) Pairs observed include BTC, ETH, SOL, BNB, XRP, LTC, DOGE vs USDT perps
2) CEX observed include Binance, Bybit, OKX & DYDX
@CexyArbBot allows you to customize CEX, 100+ pairs & lookback periods combo
The ATM IV for BTC rose significantly for both the 7-day and 30-day periods, reaching 41.22% and 41.87% respectively, in response to the positive sentiment resulting from the SEC case against XRP. The ATM IV for ETH experienced a more drastic increase, closing near its highest level in the last 30 days at 46.38% and 44.23% for the 7-day and 30-day ATM respectively.
BTC continues to exhibit a contango term structure, with the mark IV increasing across different tenors. On the other hand, ETH has seen an even higher IV across the term structure, as the XRP lawsuit victory injected volatility back into the markets, particularly on the front-end of the curve, where it shifted into a slight backwardation.
The BTC 25 Delta Skews (C-P) experienced a significant increase during yesterday's US trading session, reaching 4.90% and 3.68% for the 7-day and 30-day contracts respectively. ETH saw even more substantial increases, with figures sitting at 7.09% and 5.03% respectively. This rise in skewness is a direct result from the XRP lawsuit, as investors favored call options in anticipation of further potential upsides with the long-term market impact of the XRP victory.
During the previous trading session, market interest was concentrated on ETH rather than BTC. As reported by @Paradigm, notable ETH trades included the sale of 10,000x 25-Aug-23 2000 / 29-Dec-23 $2.1K Call Calendar, the purchase of 9,250x 21-Jul-23 $2K Call, and the purchase of 8,000x 28-Jul-23 $2K Call. These trades primarily involved relatively short-term contracts aiming to profit from short-term volatilities.
Crypto Technical Analysis
Yesterday, BTC witnessed a significant 3.41% price surge, surpassing its previous resistance at $31K, indicating a bullish rectangle pattern breakout. It's currently testing the upper bound of the resistance at $31.8K, and breaking it could pave the way to $32.7K - a potential 3.53% upside.
ETH surged 7.29% and decisively broke out of its symmetrical triangle pattern, signaling a potential bullish trajectory. However, ETH now faces a substantial resistance zone ranging from $1.95K to $2.1K. The recent breakout could provide momentum for ETH to overcome this hurdle and continue its upward momentum.
Following the Ripple Labs court ruling on XRP, other assets previously labeled as securities by the SEC such as Solana (SOL), Polygon (MATIC), and Cardano(ADA) gained sharply. MATIC has seen a breakout from its downward channel on the daily chart, crossing above the 100-day MA. The next resistance at $0.94 marks a potential 10.51% upside. Nonetheless, an RSI of 70 suggests overbought conditions, and traders should pay attention to a potential pullback.
Access institutional-grade commentary on TradFi × Crypto markets
By Treehouse Research
Treehouse Research 🌳