This week, Shiba Inu ($SHIB) is one of the most popular coins on social media. The price of SHIB was up 387% since February 26 to 0.00004567 on March 5, the highest in 2 years. The parabolic move on SHIB price also brought in massive trading demand for this token. Now SHIB is ranked 11 by market capitalization, bypassing Chainlink ($LINK) and Uniswap ($UNI), and one rank below Dogecoin ($DOGE).
Moreover, the hype on SHIB spread to other dog-themed coins, including Floki ($FLOKI). Floki experienced an exciting week, with a 400% gain in one week, from February 26 to March 4. The price surge came on the heels of a community-backed proposal to burn 2% of the token’s supply. The proposal to burn tokens was met with overwhelming support from the community, with nearly 90% of votes favouring the initiative.
With the incredible price action on meme coins, ConstitutionDAO ($PEOPLE) also joined the party. The price of PEOPLE started to pump on February 26 and posted a 125% gain when the BTC price reached a new all-time high of $69,000 today.
Overall Market
The above chart shows the BTC price movement since the end of January 2024.
BTC hit an all-time high of 69,000 USDT on the spot market today!
After the BTC price reached 69,000 USDT on November 10, 2021, the bear market began with a series of market capitulation events, including the collapse of the Terra Luna ecosystem, the bankruptcy of Three Arrow Capital, and the bankruptcy of crypto exchange FTX. On November 21, 2022, the bitcoin price fell to 15,476 USDT in just one year.
Although the Bitcoin price found its ground and moved higher in 2023, the bankruptcy of Silicon Valley Bank caused a 22% correction in Bitcoin price.
Since the beginning of 2023, the Bitcoin price has undergone multiple 15% corrections, the most recent being the selloff following the approval of Bitcoin spot ETFs.
Today, the Bitcoin price reclaimed its all-time high of 69,000 USDT before falling as much as 14.5% in five hours to $59,005 USDT on the spot market. The bulls recovered some of the loss, and it is now trading at 65,743 USDT.
Such volatile trading sessions are normal in the crypto market, and our desk observed a larger scale of correction in other altcoins, particularly those that had doubled, tripled, or even quadrupled in the previous few days.
Today’s retracement found its support at the red box zone around $59,500, as illustrated in the chart above. This is a strong support zone. The bitcoin price could continue its upward journey as long as this support level is intact.
Options Market
The above table shows the 25-delta skewness for BTC options last week.
The recent Bitcoin price action has resulted in several spikes on the short-term options market (the black line). The skewness reached more than 10 on March 1, when the Bitcoin price soared to $63,500. The increase in skewness suggests that options traders were rushing to build a positive delta position, either by buying calls, selling puts, or a combination of both.
We saw multiple downside spikes today, indicating the opposite trading action. During the capitulation, when the Bitcoin price fell to $59,000, it appeared that options traders were taking a negative delta position.
Despite significant fluctuations in the short-tenor options last week, we noticed that the skewness in the mid-to-long-tenor options remained positive at the same level. Nonetheless, options traders remain optimistic about the bitcoin price over the next three to six months. This bullish sentiment could help the BTC move higher and reach a new all-time high in the coming months.
Macro at a glance
Last Thursday (2024-02-29)
In February, Germany's monthly CPI growth rate was 0.4%, lower than the estimated 0.5%. The annualized CPI growth rate fell from 2.9% in January to 2.5% in February, which was lower than the expected 2.6%.
In January, the US PCE price index increased by 0.3% month on month, up from 0.1% in December. The annualized PCE price index rose 2.4%, in line with market expectations, slowing from 2.6% in December. The US core PCE price index was also regaining momentum, rising from 0.1% in December to 0.4% in January month on month, as expected. The annualized core PCE price index fell from 2.9% in December to 2.8% in January, as expected. The re-acceleration of PCE price index growth and core PCE price index growth raises the prospect of a June rate cut by the Fed. The US dollar index rose, while the Bitcoin price fluctuated around $62,500.
Last Friday (2024-03-01)
The annual CPI growth rate in the Eurozone fell to 2.6% in February, down from 2.8% in January. However, it exceeded the estimated 2.5% rate. The core CPI growth rate fell from 3.3% in January to 3.1% in February, but it remained higher than the expected 2.9%.
In February, the US ISM Manufacturing PMI was reported at 47.8, lower than the economists' forecast of 49.5 and further down from January's 49.1. It indicates that the US manufacturing industry has continued to contract.
On Tuesday (2024-03-05)
The US ISM non-manufacturing PMI was reported at 52.6, below the economists' forecast of 53.0.
The US equity market fell due to a selloff in AI-related stocks, including Microsoft and Adobe, after AI startup Anthropic claimed that its new models, Claude 3, could outperform OpenAI's ChatGPT. The risk-off sentiment has spread to the cryptocurrency market. BTC fell $10,000, or 14.5%, after reaching a new all-time high of 69,000 USDT in the spot market.
Convert Portal Volume Change
The above table shows the volume change on our Convert Portal by zone.
This week our desk observed massive trading demand on Meme and Metaverse zones.
The Meme zone's volume increase of 1,182.1% is primarily driven by high demand for Shiba Inu ($SHIB). Shiba Inu ($SHIB) has doubled in price over the last seven days, owing to strong buying demand. The popularity of dog-themed coins increased trading volume for Dogecoin ($DOGE) and Floki ($FLOKI). Meme ($MEME), ConstitutionDAO ($PEOPLE), and Bonk ($BONK) are also experiencing significant trading volume increases.
The trading volume in the Metaverse zone has risen by 160.7% in the last seven days. Decentraland ($MANA) and The Sandbox ($SAND) are the primary sources of increased demand.
Our desk saw a 126.7% increase in trading volume in the POW zone. With Bitcoin reaching a new all-time high of $69,000, trading volume for Bitcoin ($BTC) and Bitcoin Cash ($BCH) increased a lot, generating strong interest in coins in the POW zone.
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