OTC Weekly Trading Insights (01/23/2025)
Top Interest of the WeekThe Official Trump ($TRUMP) token has made headlines by becoming the fastest cryptocurrency to reach a market capitalization of 1 billion USD, a milestone achieved with authentic trading activity backing it. This unprecedented rise in popularity can be traced back to a series of strategic promotions by President Donald Trump on social media platforms such as X (formerly Twitter) and Truth Social. His endorsement sparked a wave of enthusiasm among investors, leading to a dramatic price surge that saw the token leap from under 2 cents to over 8 dollars in just three hours. This meteoric rise culminated in the TRUMP meme coin achieving an astonishing market cap of 30 billion dollars before listing on any major centralized exchanges.As the token gained traction, its listing on centralized exchanges further fueled its price escalation, pushing it close to the $80 mark. The inherent volatility of the TRUMP token created a fertile ground for traders, offering them significant opportunities to capitalize on rapid price fluctuations and resulting in substantial profits for many. The excitement surrounding the TRUMP token was so intense that it triggered a widespread sell-off of other cryptocurrencies, with the notable exception of Solana ($SOL). Investors, eager to capitalize on the TRUMP phenomenon, rushed to liquidate their holdings in other assets to acquire Solana, which they then used to purchase TRUMP on decentralized exchanges.The surge in interest and trading activity surrounding the TRUMP coin had a profound impact on the Solana network, leading to the creation of over 100 million new wallets. This influx of new users generated considerable trading and gas fees, significantly benefiting the ecosystem. Raydium ($RAY), the leading decentralized exchange by trading volume within the Solana ecosystem, saw a remarkable 34.9% increase in activity over the past week, largely driven by the heightened trading volume associated with the TRUMP token. Similarly, Jupiter ($JUP), recognized as the largest perpetual exchange on the Solana chain, also enjoyed a boost from the trading frenzy, further solidifying the TRUMP coin's influence on the broader cryptocurrency market.Overall MarketSource: TradingViewThe above chart is the BTC price in the daily candle chart at the log scale.In our previous analysis, we conducted a thorough examination of the expected fluctuations in Bitcoin (BTC) price as we approached Inauguration Day on January 20. Our team utilized a combination of historical data, market sentiment, and technical indicators to formulate our predictions. We anticipated a slight increase in price leading up to that pivotal date, driven by speculative trading and heightened interest in the cryptocurrency market. This anticipated rise was expected to culminate around Inauguration Day, followed by a pullback that would correspond with the red circle highlighted on the accompanying chart.As the date drew nearer, our predictions began to materialize. On January 19, just one day before the Inauguration, the BTC price reached an impressive peak of 109,588 USDT. This surge was likely fueled by a mix of optimism surrounding the new administration and the broader market's bullish sentiment toward cryptocurrencies. However, the excitement was short-lived. Following Trump's inauguration speech, which notably omitted any mention of Bitcoin or cryptocurrency, the bullish trend quickly dissipated. This lack of acknowledgment from the new administration may have led to a sense of uncertainty among investors, prompting a reevaluation of their positions.Consequently, the BTC price experienced a significant decline, dropping to the critical $100,000 threshold. This level proved to be a crucial support point, as many traders and investors had set buy orders in anticipation of a rebound at this psychological barrier. The influx of buying activity at this level allowed BTC to stabilize and subsequently rebound, with the price recovering to the $106,000 mark.As the price continues to gradually decline while remaining above the $100k mark, market sentiment has not aligned with our expectations. We anticipated a bearish shift and profit-taking from traders following the inauguration day, but this has not materialized. One possible reason for this is that the market appears to be awaiting Trump’s executive orders and the potential announcement regarding the Strategic Bitcoin Reserve. Additionally, there has been a significant influx of buying activity from ETFs, coupled with several publicly traded companies announcing their intention to adopt Bitcoin into their balance sheets.In the next few days, if we observe a sharp drop in BTC prices, it would reinforce our expectation of a 20-25% correction before the next upward movement. Conversely, if BTC trades sideways and maintains the $100k level as a solid support, it could initiate a rally during the Lunar New Year period.Regardless of the scenario, our team is confident that the BTC bull market is still in play, and we do not view $110k as the peak of this bull run. Furthermore, we expect altcoins to outperform BTC in the upcoming upward movement.Options Market The above table shows the 25-delta skews on BTC and ETH options.A positive 25-delta skew indicates that the premium for a 25-delta call option exceeds that of a 25-delta put option. This phenomenon suggests that traders are willing to pay more for the potential upside of the asset, reflecting a bullish sentiment in the market. The 25-delta skew serves as a valuable proxy for gauging market sentiment through the options market, as it provides insights into how traders perceive future price movements.According to the table above, the current market sentiment regarding Bitcoin (BTC) over the next week appears relatively neutral. This neutrality suggests that traders do not anticipate significant price fluctuations in the short term, indicating a wait-and-see approach. However, despite this short-term outlook, there is a strong bullish sentiment for longer-term BTC options. This indicates that while traders may be cautious in the immediate future, they are optimistic about BTC's potential for growth over a more extended period.A similar trend is observed in the skew of Ethereum (ETH) options, where the market sentiment reflects a comparable dynamic. The positive skew in ETH options suggests that traders are also leaning towards a bullish outlook for Ethereum in the longer term, despite a neutral stance in the short term.This observation aligns with our model outlined in the “Overall Market” section, which takes into account various factors influencing market dynamics. Our team anticipates that BTC prices may remain stable or even decrease in the coming days, reflecting the current neutral sentiment. However, we also expect a significant upward movement in BTC prices by or following the Lunar New Year. This anticipated price increase could be driven by various factors, including seasonal trends, increased market activity, or broader economic developments that may influence investor behaviour.Macro at a glance Last Thursday (25-01-16)The growth of US retail sales fell short of market expectations. The monthly increase in retail sales was recorded at 0.4% for December, which was below the anticipated 0.6%. Similarly, the growth rate for core retail sales also stood at 0.4%, falling short of the forecasted 0.5%.Initial jobless claims in the US remained low, with a report of 217,000 claims last week. The labour market continues to exhibit resilience, indicating that the Federal Reserve may adopt a more cautious approach to interest rate reductions in 2025.On Monday (25-01-20)Donald Trump was inaugurated as the 47th president of the United States. Following his swearing-in ceremony at the US Capitol in Washington, D.C., he delivered an approximately 30-minute speech. Notably, the address did not mention bitcoin or cryptocurrency, leading to a decline in BTC prices to the $100,000 mark after the speech.On Tuesday (25-01-21)Canada's inflation rate experienced a slight decrease in December, registering an annual growth of 1.8%, down from 1.9% in November. Core inflation demonstrated persistence, increasing to 1.8% in December, compared to 1.6% in the previous month.Later this weekThe Bank of Japan is anticipated to increase its benchmark interest rate by 25 basis points to 0.50% this Friday. It is likely to negatively impact global liquidity and put some pressure on the BTC price.Convert Portal Volume ChangeThe above table shows the volume change on our Convert Portal by zone. The Official Trump ($TRUMP) coin has generated significant trading interest in the cryptocurrency market, leading to a substantial acceleration in crypto adoption. The advantages extend beyond Trump himself, who saw an increase of $60 billion in net worth in just one day; the Solana network also stands to gain. By launching his meme coin on the Solana network, Donald Trump sparked considerable excitement, resulting in a surge in the creation of new Solana wallets. Additionally, this development encouraged users to engage with decentralized exchanges and start DEX trading, as the token was initially accessible only on-chain.In the Megadrop zone, trading activity surged by more than 2900%, driven by heightened interest in Solv Protocol ($SOLV), a Bitcoin staking platform. Meanwhile, in the Meme zone, TRUMP emerged as the primary factor behind a 396.8% rise in volume. Additionally, TRUMP played a significant role in boosting volume in both the Seed zone and the Solana zone.Why trade OTC? Binance offers our clients various ways to access OTC trading, including chat communication channels and the Binance OTC platform (https://www.binance.com/en/otc) for manual price quotations, Algo Orders, or automated price quotations via Binance Convert and Block Trade platform (https://www.binance.com/en/convert) and the Binance Convert OTC API.
