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
- China markets rally on signs of easing lockdown measures (more in Macro & TradFi)
- Opensea adds support for NFT collection on BNB Chain; FTX hacker allegedly transfers $4.1million worth of funds to OKX after withdrawing from ChipMixer; Serum is no longer operational on mainnet (more in DeFi & CeFi)
- Depressed BTC SOPR levels could indicate a potential bottoming process (more in On-Chain)
- IV and RV back to levels pre-FTX contagion; Traders scoops up vol amidst falling vols (more in Crypto Derivatives)
- BTC and ETH tested the upper limit of their tight ranges yesterday, before breaking out in the early Asian hours today (more in Crypto Technical Analysis)
Macro & TradFi
Upcoming data (JOLTs jobs opening & ADP payroll change) and Powell’s scheduled speech today capped wider market sentiment, but spots of strength were still seen. Chinese assets blew higher yesterday as health authorities talked down stepping up COVID restrictions, accelerating vaccination for the elderly, and the iPhone production center Zhengzhou saw the lifting of its “mobility control”. CNH rallied almost 1.5% against the greenback while Hong Kong’s HSI added 4%, HSTECH 7.5%, Chinese ADR index 5%. On the US investment grade corporate debt market, around 10 borrowers were preparing to sell bonds Tuesday to lock in deals before expected macro volatility late in the week; among the cohort was Amazon, who targeted an $8.25bn, five-tranched deal.
US stocks closed marginally lower after earlier losses. DOW and S&P ended around unchanged while NASDAQ lost ~0.5%. Oil held gains with WTI rallying over 2% and Brent 1%. US Treasury bond yields jumped across the board as jumbo corporate debt issuances jammed the market as hedging demands increased; long-end of the curve steepened more as 30y yield added 8.6bps.
DeFi & CeFi
- Opensea goes live on BNB Chain
- FTX hacker allegedly transfers at least $4.1M stolen funds to OKX
- Ledger Live adds support for Cronos, Fantom, Moonbeam and Songbird
- MakerDAO votes on increasing DAI savings rate
- Solana-based wallet Phantom plans to integrate with Ethereum and Polygon
- Aptos is integrating MoonPay’s technology into Petra wallet
- Compound to set borrowing caps on 10 collateral assets
- Seven protocols from Polkadot ecosystem form a Polkadot Alliance
- Solana-based DEX Serum program become defunct but Openbook, a fork of Serum, remains available to use
- Cardano-based DEX Adaswap goes live on mainnet
- Ethereum scaling solution Scroll submit a proposal in Uniswap community to deploy Uniswap V3 on its testnet
Centralized NFT marketplace Opensea has announced support for BNB Chain. Every NFT transaction on the BNB Chain that took place at the start of the year will be available on Opensea. The marketplace will work to backfill historical data. Elsewhere, on-chain sleuth ZachXBT said that the FTX hacker had transferred at least 255 $BTC (~$4.1 million) to OKX after withdrawing from ChipMixer. Finally, seven projects from the Polkadot ecosystem announced the formation of the Polkadot Alliance, an on-chain collective that establishes and upholds a set of rules for the greater community to follow. Founding members include Acala, Astar, Interlay, KILT Protocol, Moonbeam, Subscan and Phala.
For on-chain, BTC Daily SOPR is at depressed levels, with daily SOPR reaching 2018 lows. SOPR is an indicator that reflects the degree of realized profit and loss for all coins moved on-chain, and prolonged periods of low SOPR are usually good for price, as it could potentially mean that BTC is getting closer to approaching a bottom.
Elsewhere, Santiment has noted that the number of active addresses on Ethereum spiked to its highest level in over 6 weeks and was likely factored into ETH’s price growth. The previous time when addresses spiked at this level, the price of ETH jumped +30% over the next 3 weeks.
- Funding rate remains positive on both BTC and ETH perps
- 30-day IV fell for both BTC and ETH to 57.69% and 77.76%, respectively
- 30-day 25d put skew eased for both BTC and ETH to -10.57% and -12.77%, respectively
For futures, total liquidations came in at $55M, with the majority coming from shorts at $28M.
On the options front, RV is back into the 30s for BTC and the 50s for ETH, allowing the variance risk premium to widen to +19% for BTC and +21% for ETH. The 7-day BTC RV is currently at its lowest level for November, standing at 32.36%. The 30-day IV for BTC is now below 60% and below 80% for ETH. With plummeting IV, RV, and easing skew, the options market appears to have moved on from the FTX contagion, with no overhang remaining.
On the flow front, the cratering IV appears to be motivating some vol buyers, as large clips of strangles were blocked on Paradigm yesterday. Some noteworthy trades include the December 12K/21K BTC strangle and the December 1.1K/1.3K ETH strangle. Meanwhile, long-dated options, such as those expiring on March 31, 2023, continue to be heavily traded on exchanges, with volume remaining high in recent days.
Crypto Technical Analysis
BTC closed 1.38% higher at 16,434. On the H4, BTC mainly ranged between the two liquidity zones at $16,200 and $16,550. It tested the $16,550 zone multiple times yesterday and has broken out of the resistance level as of early Asian hours today. It may meet some resistance at the $16,800 liquidity zone. Should price hold at that level, a move up to $17,100 could be warranted.
For ETH, it has closed 4.12% lower at $1215.70. On the H4, ETH managed to close above the $1184 resistance and proceeded to range between $1184 and $1220, testing the $1220 level multiple times yesterday. Similar to BTC, it has broken out of the $1220 resistance in the early Asian hours and currently meets resistance at $1271. Should it continue its upward move, a retest of $1342 is likely to occur.
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