Table of contents:
1. Review of BTC's weekly trend and technical analysis;
2. An overview of the crypto market, quickly read the rise and fall of popular currencies/capital flows of sectors in the week;
3. The inflow and outflow of spot ETF funds, with the inflow scale setting a monthly record;
4. The BTC balance on the exchange hit a new record low, with only three companies having sufficient reserves;
5. The weighted funding rate of BTC contracts fell, but remained at a medium-high level;
1.BTC weekly trend review and technical analysis:
Last week, the overall market fluctuated from a decline to a rise, falling from $99,000 to around $90,866, which was in line with our previous prediction that the support position was below $91,000 in the main chip distribution chart. It then rebounded to around $98,713 and fell back again.
The trend indicator has signaled a switch twice on the 4-hour level, first turning bearish after breaking below $95,000, and then turning bullish again as the market rebounded to $97,000. This verifies that the market is oscillating within the $91,000-$99,000 range and does not show a continuation of the trend. The daily line still maintains a death cross state, with short-term support continuing to reference below $91,000, and mid-term support around $87,000 and $85,000. Short-term resistance above is referenced at recent highs around $99,588 and historical peaks.
2. Overview of the cryptocurrency market, a quick read on the price fluctuations of popular coins/sector fund flows over the week.
In the past week, the cryptocurrency market, segmented by concept sectors, has seen concentrated fund inflows in major areas such as the Arbitrum ecosystem, Solana ecosystem, Optimism ecosystem, and Ethereum ecosystem, with the top three sectors seeing inflows of over $1.3 billion. The Avalanche ecosystem has also experienced a net inflow of over $400 million. Many coins in these concept sectors have seen significant rotational increases over the past week, such as VIRTUAL and ENS tokens.
Additionally, we need to pay attention to the major reason for the significant net inflow of funds into the top three concept sectors: the large issuance of USDC stablecoins amounting to $1 billion. Excluding these impacts, there is still a net inflow of $300-400 million, which ranks among the top.
3. The inflow and outflow of funds for spot ETFs.
The monthly inflow of funds has surged dramatically, reaching as high as $6.5 billion, setting a new historical peak, far exceeding previous monthly records. The continuous rise in Bitcoin prices has successfully attracted a large number of investors. Especially on Wall Street, Bitcoin prices have repeatedly set new highs, allowing all Bitcoin ETF investors to reap substantial profits. The $100,000 price threshold is now within reach, and market enthusiasm continues to rise without abatement. Institutional investors who have made huge returns this year may further increase their allocation to Bitcoin next year.
The total open interest for the US spot Bitcoin ETF has reached approximately 1.132 million BTC, accounting for over 5.7% of the current BTC supply, with an on-chain holding value of about $10.3157 billion.
The surge in fund inflows and the increase in open interest indicate an extremely strong demand for Bitcoin spot ETFs. The continued rise in prices has attracted more investors, especially in the financial core area of Wall Street, showing increased market confidence in Bitcoin. The satisfaction and returns of risk managers suggest that their decisions have received positive feedback from the market. The breakthrough in open interest and the rise in value further reflect the market's activity level and the importance investors place on it.
4. The on-exchange reserves have reached a new historical low, with only three exchanges having reserves that meet buyer demand.
Data shows that the Bitcoin balance in cryptocurrency exchanges has fallen to a historic low, decreasing by over 126,000 coins in the past month. The number of Bitcoins available for purchase has sharply reduced, indicating that the Bitcoin available for direct acquisition on exchanges has become extremely scarce, which may affect trading activity and prices. The current situation is drastically different from the trend seen mid-year, when there was a sudden inflow that temporarily filled the reserves of exchanges. However, this time, there has been no such increase in inventory, further exacerbating the tightening supply situation. The mid-year situation starkly contrasts with the current tight supply, which may significantly alter the market's supply-demand balance.
The cryptocurrency market, led by Bitcoin, is being driven by favorable factors, indicating a potential for sustained growth in the coming year. On-chain analysis shows that long-term holders are typically viewed as a stabilizing force in the market, firmly holding their positions and limiting Bitcoin's inflow into exchanges, leading to a decrease in liquidity. Positive catalysts bring hope for market growth, but the steadfast holding behavior of long-term holders has somewhat impacted market liquidity.
Currently, only three major exchanges, including Binance, claim to have sufficient Bitcoin reserves to meet buyer demand. Smaller exchanges are facing increasingly severe challenges in maintaining liquidity, which may lead to more volatile price fluctuations. The relative advantages of major exchanges and the predicaments faced by smaller exchanges may change the trading landscape of the market, thereby affecting price volatility.
5. The funding rate for BTC contracts has slightly decreased but remains at a medium to high level.
According to contract data, since September 14, the BTC contracts have maintained a positive level, meaning a long position, dropping from a level of 0.05 in mid-November to the current 0.02 level. This represents a decline compared to earlier periods but still remains at a medium to high level. This indicates a slight decrease in market FOMO sentiment, and the funding rate is gradually moving towards a healthier state. On the other hand, due to recent fluctuations in BTC prices, some speculative funds have shifted to altcoin hotspots, coupled with the gradual involvement of previous short arbitrage funds, which has somewhat adjusted the rates.
