Total crypto market cap takes another hit, but traders remain neutral

The full cryptocurrency marketplace capitalization dropped 8.1% successful the past 2 days aft failing to interruption the $880 cardinal absorption connected Dec. 14. 

The rejection did not invalidate the 4-week-long ascending channel, but a play adjacent beneath $825 cardinal volition corroborate a displacement to the little set and trim the enactment level to $790 billion.

Total crypto marketplace headdress successful USD, 12-hour. Source: TradingView

The wide capitalist sentiment toward the marketplace remains bearish, and year-to-date losses magnitude to 66%. Despite this, Bitcoin (BTC) terms dropped a specified 2% connected the week, down to the $16,800 level astatine 17:00 UTC connected Dec. 16.

A acold antithetic script emerged for altcoins which are being pressured by pending regularisation and fears that large exchanges and miners could beryllium insolvent . This explains wherefore the full marketplace capitalization had dropped by 4.7% since Dec. 9.

According to tribunal documents filed connected Dec. 15, a United States Trustee announced the committee responsible for portion of FTX's bankruptcy proceedings. Among those is Wintermute Asia, a starring marketplace shaper and GGC International, an affiliate of the troubled lending level Genesis. Investors stay successful the acheronian astir who the biggest creditors from the failed FTX speech radical are and this is fueling speculation that contagion could proceed to spread.

On Dec. 15, The cardinal slope of the Netherlands issued a informing to investors utilizing KuCoin, saying the speech was operating without ineligible registration. De Nederlandsche Bank added that the crypto steadfast was "illegally offering services" and "illegally offering custodian wallets" for users.

Adding to the drama, connected Dec. 16, Mazars Group, a institution known for its proof-of-reserve audit services for crypto companies, reportedly removed caller documents that item speech audits from its website. The steadfast was antecedently appointed arsenic an authoritative auditor for Binance's proof-of-reserve updates, a question that was followed by Kucoin and Crypto.com.

The Bitcoin mining assemblage has besides suffered owed to the beardown correction successful cryptocurrency prices and rising vigor costs. Publicly-listed miner Core Scientific was offered a $72 cardinal contingent emergency recognition enactment to debar bankruptcy. The fiscal lender requires suspension of each payments to Core Scientific's instrumentality lenders portion Bitcoin remains beneath $18,500.

The 4.7% play driblet successful full marketplace capitalization was impacted chiefly by Ether's (ETH) 5.4% antagonistic terms determination and BNB, which traded down 15.1%. Consequently, the bearish sentiment importantly impacted altcoins, with 14 of the apical 80 coins dropping 12% oregon much successful the period.

Weekly winners and losers among the apical 80 coins. Source: Nomics

The Open Network (TON) gained 30% aft Telegram launched bidding for anonymous telephone numbers sold for TON tokens.

Bitcoin SV (BSV) rallied 11.7% aft Craig Wright, the self-proclaimed Satoshi Nakamoto and person of the altcoin project, appealed to his nonaccomplishment successful Norway courts.

Trust Wallet (TWT) saw a 27.2% correction aft its genitor institution (Binance) faced $1.9 cardinal successful withdrawals successful 24 hours.

Leverage request is balanced betwixt bulls and bears

Currently, information shows request for leverage is divided betwixt bulls and bears.

Perpetual contracts, besides known arsenic inverse swaps, person an embedded complaint usually charged each 8 hours. Exchanges usage this interest to debar speech hazard imbalances.

A affirmative backing complaint indicates that longs (buyers) request much leverage. However, the other concern occurs erstwhile shorts (sellers) necessitate further leverage, causing the backing complaint to crook negative.

Perpetual futures accumulated 7-day backing complaint connected Dec. 16. Source: Coinglass

The 7-day backing complaint was adjacent zero for Bitcoin and altcoins, meaning the information points to a balanced request betwixt leverage longs (buyers) and shorts (sellers) successful the period.

Traders should besides analyse the options markets to recognize whether whales and arbitrage desks person placed higher bets connected bullish oregon bearish strategies.

The options put/call measurement reflects a neutral market

Traders tin gauge the market's wide sentiment by measuring whether much enactment is going done telephone (buy) options oregon enactment (sell) options. Generally speaking, telephone options are utilized for bullish strategies, whereas enactment options are for bearish ones.

A 0.70 put-to-call ratio indicates that enactment options unfastened involvement lag the much bullish calls by 30% and this is bullish. In contrast, a 1.40 indicator favors enactment options by 40%, which tin beryllium deemed bearish.

BTC options measurement put-to-call ratio. Source: laevitas.ch

Even though Bitcoin's terms failed to interruption the $18,000 absorption connected Dec. 14, determination was nary excessive request for downside extortion utilizing options. More precisely, the indicator has been beneath 1.00, truthful somewhat optimistic, since Dec. 12.

Presently, the put-to-call measurement ratio stands adjacent 0.88 due to the fact that the options marketplace is much powerfully populated by neutral-to-bullish strategies which favors telephone (buy) options by 12%.

Derivatives markets are neutral, but the newsflow is negative

Despite the important play terms diminution successful a fistful of altcoins and the 4.7% driblet successful full marketplace capitalization, derivatives metrics bespeak nary signs of panic.

There has been a balanced request for longs and shorts utilizing futures contracts. As a result, the BTC options hazard appraisal metric remains favorable adjacent aft Bitcoin's 8.5% correction pursuing the $18,370 precocious connected Dec. 14.

Ultimately, bulls should not expect the $825 cardinal marketplace capitalization to hold, which does not needfully mean an contiguous retest of the $790 cardinal support.

Currently, the little set of the ascending transmission continues to exert upward pressure, but the newsflow looks favorable for bears.

The views, thoughts and opinions expressed present are the authors’ unsocial and bash not needfully bespeak oregon correspond the views and opinions of Cointelegraph.

This nonfiction does not incorporate concern proposal oregon recommendations. Every concern and trading determination involves risk, and readers should behaviour their ain probe erstwhile making a decision.