Table of contents:

1.BTC 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, the inflow scale of ETH set a single-week record;

4. The BTC balance on the exchange hit a new historical low;

5. Interpretation of BTC contract and altcoin funding rates;

 

1.BTC technical analysis:

#BTC☀ In the past week, the market experienced large fluctuations, rising from around US$93,578 to around US$104,088 last week, setting a new record high. It then began a large-scale retracement, falling again below our previously predicted support of US$91,000, and quickly rebounded to our predicted resistance of around US$101,500. This week, it started to pull back again to around US$94,150, and the overall rhythm was relatively consistent with that of the US stock market.

The trend indicator on the 4-hour level has been showing bearish signals since last week's sharp decline. It is currently testing near the rising trend line again, with the closing price temporarily above. This is crucial for future direction; if it does not break, it is expected to continue the recent overall oscillating upward trend. However, if it breaks down, it will continue to test our previously analyzed short-term support reference below $91,000, with medium-term support near $87,000 and $85,000. Short-term resistance above is referenced at recent highs around $100,420 and the historical peak.

2. Overview of the cryptocurrency market, a quick read on the weekly rise and fall of popular coins/fund flows by sector.

In the past week, funding inflows categorized by concept sectors concentrated in several major areas such as the Avalanche ecosystem, Arbitrum ecosystem, Optimism ecosystem, and Solana ecosystem. In the past week, many tokens like BABYDOGE, CRV, MNT, ERGEN, and PEPE have also seen significant rotational increases.

Additionally, we need to note that part of the significant net inflow of funds in some concept sectors is also due to large-scale issuance of stablecoins. Data shows that in the past month, Tether has issued 20 billion USDT on the Ethereum network and the Tron network.

3. Funding inflow and outflow situation.

Data shows that since Trump was elected President of the United States, investment directed towards Bitcoin exchange-traded funds (ETFs) has attracted a large inflow of funds. A total of 12 related funds launched by issuers such as BlackRock and Fidelity have cumulatively attracted about $9.9 billion in net inflows, growing the total assets of these funds to approximately $113 billion. This reflects people's bets that Trump's positive attitude towards the cryptocurrency industry will drive the market towards prosperity. The event of Trump being elected President has had a significant impact on the cryptocurrency market, with substantial inflows into Bitcoin-related ETFs, indicating investor optimism regarding the development of the cryptocurrency industry under Trump's administration, believing that his policies could benefit market prosperity.

In the past week of trading, Ethereum spot ETFs have performed outstandingly, with a net inflow of $837 million in a single week, setting a new record for weekly net inflows. This indicates a surge in market investment enthusiasm for Ethereum. However, Grayscale's ETHE has seen net outflows, which may reflect a shift in attitude or adjustment in investment strategies among some investors. The large net inflows into BlackRock's ETHA and Fidelity's FETH show that these institutions' Ethereum ETF products have strong market appeal and investor recognition. Overall, the flow of funds reflects market participants' preferences for different cryptocurrency products and their judgments on market trends. However, it is important to note that the cryptocurrency market is highly volatile and uncertain, and investors should carefully assess risks when participating.

4. On-chain funding reaches a new historical low.

Data shows that Bitcoin balances in CEX have hit a new historical low, decreasing by more than 15,000 coins in the past 7 days. The balance of Bitcoin at centralized exchanges has reached its lowest point in history, which may indicate several important shifts in the market. It suggests that investors are more inclined to hold Bitcoin for the long term rather than engage in short-term trading, which is usually related to an increased confidence in the long-term value of the asset. Long-term holders are viewed as a stabilizing force in the market, and their actions reduce Bitcoin inflows to exchanges, thereby decreasing market liquidity. This trend may exacerbate Bitcoin's supply tightening, as more Bitcoin is held rather than traded, which could put upward pressure on prices if demand continues.

This phenomenon may be related to the increased acceptance of Bitcoin as a store of value, especially in the context of growing global macroeconomic uncertainty. With increased inflows into Bitcoin ETFs and more companies like MicroStrategy incorporating Bitcoin into their balance sheets, Bitcoin's status as a mainstream financial asset is being strengthened.

5. Interpretation of BTC contracts and altcoins.

According to contract data, the funding rate for BTC contracts has recently remained in a positive multi-paid short state, reaching a phase high on December 5, approaching the level of 12,000, when BTC also hit a historical high.

In terms of altcoins, several altcoins such as HBAR, XLM, XRP, ALGO, and ADA experienced significant price increases during the same period last week, with gains exceeding 250% within 30 days. The funding rates for perpetual futures contracts have risen to between 4% and 6% per month, reflecting an increase in leverage usage. High funding rates may indicate optimistic sentiment towards altcoins and further growth potential but also increase trader risk. For instance, ALGO's price rose over 15% on Friday, reaching a two-year high, with open interest (OI) and total locked value (TVL) hitting historical highs, showing strong market interest and fund inflows for ALGO. However, if the weekly closing price falls below a certain key level, it may lead to a price correction.

Compared to major cryptocurrencies like BTC and ETH, altcoins exhibit more aggressive leverage usage, contrasting sharply with their relatively moderate leverage. For example, Bitcoin's leverage has reached an annual high, indicating greater volatility for BTC prices. High leverage usage in altcoins may signify higher market risks and potential price corrections.

The significant rise of altcoins in the past month is the result of various factors, including market sentiment, fund flows, and increased leverage usage. While high funding rates and rising prices may indicate optimistic sentiment towards these assets, they also suggest potential market risks.