Although the price trend over the past week was quite volatile, it ultimately remained between $92,500 and $99,000, leading to a contraction in actual volatility (at least the volatility between settlement points). We speculate that the next few trading days will continue to maintain this trend, but fluctuations may occur at the year-end settlement. Meanwhile, this longer price adjustment may end before the year-end and prepare for the next round of increases.
Key indicators: (December 23 4 PM -> December 30 4 PM Hong Kong time) BTC against USD fell by 1.9% ($95,300 -> $93,500), ETH against USD rose by 3.0% ($3,300 -> $3,400). Although the price trend over the past week was quite volatile, it ultimately remained between $92,500 and $99,000, leading to a contraction in actual volatility (at least the volatility between settlement points). We speculate that the next few trading days will continue to maintain this trend, but fluctuations may occur at the year-end settlement. Meanwhile, this longer price adjustment may end before the year-end and prepare for the next round of increases. The current support level is as low as $92,000, and we expect good support at the $90,000 level; the next support level will fall all the way to $85,000. If the support at $85,000 is broken, we could see a more substantial decline, but we believe that such a scenario is very unlikely to happen. Moving to the price above, if the price successfully regains the psychological level of $100,000, it will open up opportunities to reach our target price level of $115,000 - $120,000 (expected in the early to mid-first quarter). The market theme is very quiet during the holiday week, with prices slightly adjusting under the influence of a more hawkish Fed meeting, while the US stock market undergoes a downward correction and the dollar (against other fiat currencies) rises. The momentum of the cryptocurrency market is starting to turn downward. The current market is undoubtedly bullish, but it is difficult to find signs of buyers. Rumors suggest that MSTR will enter a quiet period before its January earnings report, which also reduces the pressure for BTC prices to rise in the coming weeks. Despite some fluctuations in the price, the implied volatility of BTC ATMs has been continuously decreasing as the price finds balance within the range of $92,000 - $99,000. However, the implied volatility for February and beyond remains stubbornly high, as the market is still digesting the significant demand from earlier this month. We expect implied volatility to decrease more reasonably in January. The current market pricing for implied volatility in the first quarter averages over 60 points weekly, which historically has been difficult to maintain. Although the market is readjusting positions at the beginning of the new year, and Trump will announce his inauguration on the 20th, we anticipate seeing an increase in January’s volatility. However, BTC assets have become more stable and are receiving strong support from ETF inflows. Therefore, we believe that the sustainable actual volatility will be in the range of 40-50 (instead of the current pricing exceeding 60 points for February/March and later expiry dates). BTC Skew/Kurtosis Despite the implied volatility remaining unchanged at low prices, while the actual volatility below is also quite high, the skew has shown an upward trend this week. The market continues to seek upward opportunities in 2025 and utilizes the current lower coin prices to achieve this. Meanwhile, the substantial buying flow earlier this month caused shorts in the middle of the curve. With the correlation between price and skew being disrupted, kurtosis has unilaterally declined. Meanwhile, there is still a lack of demand for the downside wings in the medium to long term (only a few strategic short-term buyers to prevent the price from collapsing below $90,000). This concludes the report for 2024! Thank you for reading, and Happy New Year! You can use the SignalPlus trading sentiment feature on t.signalplus.com for more real-time cryptocurrency information. If you want to receive our updates instantly, feel free to follow our Twitter account @SignalPlusCN, or join our WeChat group (add assistant WeChat: SignalPlus123), Telegram group, and Discord community to interact and communicate with more friends. SignalPlus Official Website: https://www.signalplus.com

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