Asia Morning Briefing: Bitcoin’s Thin-Liquidity Bounce Raises Questions on Staying Power

5 hours ago

Good Morning, Asia. Here's what's making quality successful the markets:

Welcome to Asia Morning Briefing, a regular summary of apical stories during U.S. hours and an overview of marketplace moves and analysis. For a elaborate overview of U.S. markets, spot CoinDesk's Crypto Daybook Americas.

Bitcoin staged a crisp betterment implicit the past week, rebounding from a dip beneath $114,000 to commercialized adjacent $121,000, successful what Glassnode described successful a caller report arsenic a displacement from “seller exhaustion to a beardown rebound adjacent caller ATHs.”

The rally, however, came without a surge successful spot marketplace participation.

Glassnode information shows spot trading volumes fell 22% to $5.7 billion, adjacent to their statistical debased band, suggesting the rebound has been driven much by positioning shifts than heavy condemnation buying. The Spot Cumulative Volume Delta flipped 94% toward bargain pressure, a motion that assertive selling has been replaced by renewed demand, but not yet crossed a wide basal of traders.

On the derivatives side, leveraged traders re-engaged aggressively, Glassnode elaborate successful its report.

Perpetual Cumulative Volume Delta, a measurement of the buy-sell unit successful perps, jumped 88%, backing rates remained elevated, and options unfastened involvement climbed 6.7% to $42.4 billion. Yet, volatility pricing collapsed by astir a third, indicating a grade of complacency that has historically preceded ample marketplace moves.

ETF flows offered immoderate relief, with U.S.-listed spot bitcoin ETF outflows halving to $311 cardinal from $686 cardinal the anterior week. Even so, ETF commercialized measurement fell 27.7% to $13.7 billion, keeping enactment adjacent its debased band.

QCP Capital framed the play surge, which concisely pushed BTC supra $122,000, arsenic a relation of bladed bid books and a broader risk-on displacement successful planetary markets.

“Crypto staged an awesome comeback implicit the play during thin, low-liquidity trading hours,” the Singapore-based trading steadfast wrote, noting that the bounce aligned with a rebound successful U.S. equities and increasing expectations for a September Fed complaint cut.

While on-chain enactment improved, progressive addresses jumped 8.4% to 793,000, and interest measurement roseate 10%. Glassnode cautioned that elevated profitability levels could rapidly crook into selling unit if sentiment shifts. With 94.1% of proviso successful nett and the realized profit-to-loss ratio climbing to 1.9, the marketplace whitethorn beryllium nearing a constituent wherever profit-taking accelerates.

The operation of bladed liquidity, bullish derivatives positioning, and macro-driven optimism leaves Bitcoin primed for volatile moves arsenic it approaches all-time highs, with the adjacent trial apt coming from Tuesday’s U.S. CPI release.

Polymarket traders thin toward a humble uptick successful enactment with statement that would apt support BTC consolidating, with hotter prints posing a short-term headwind by delaying Fed cuts and softer readings offering a imaginable breakout catalyst if ETF flows and spot enactment strengthen.

Market Movers

BTC: Bitcoin is trading astatine $118k arsenic traders propulsion backmost and presumption themselves for the anticipation that Tuesday's CPI study mightiness interruption BTC's momentum.

ETH: Ethereum is trading astatine $4200. Analysts say that ETH's rally is partially owed to accrued capableness on-chain and little DeFi costs.

Gold: Gold slid to $3,355.13 arsenic upbeat hazard sentiment and Trump’s pledge to exclude golden from tariffs weighed connected safe-haven demand, though losses were cushioned by rising Fed complaint chopped bets up of this week’s U.S. ostentation data.

Nikkei 225: Asia-Pacific markets roseate Tuesday, with Japan’s Nikkei 225 hitting a grounds precocious aft the U.S.-China commercialized truce was extended, portion investors awaited the Reserve Bank of Australia’s expected complaint cut.

S&P 500: U.S. stocks eased, with the S&P 500 down 0.2% and conscionable nether its record, arsenic investors await caller ostentation information .Meanwhile, Citigroup and UBS lifted their year-end S&P 500 targets, citing easing argumentation risks and coagulated earnings, with Citi raising its forecast to 6,600 and UBS to 6,100.