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Bitcoin Back Above $11K as USDT Flows Continue and Futures Basis Surges — Crypto Market Daily

2020.07.29 Robbie Liu

After a brief pullback, Bitcoin (btc-usd" target="_blank">BTC) saw a further appreciation in the last 24 hours, going up 1.12% to trade around $11,030, as per the OKEx BTC Index price. The overall trend in Bitcoin remains strong, generally buoying the market and helping large-cap coins make important breakthroughs.

Bitcoin Cash (BCH), for instance, surpassed its previous high of $280 and continued to move up quickly to its current level near $293, rising 7.54% in the last 24 hours. The BCH/BTC pair also reached two-month highs of 0.0269 last night. This breakout may attract more traders to join and thus keep the rally going. 

EOS and XRP, on the other hand, respectively surged 10.73% and 8.17%, and both have reached new highs since April 29. Ether (ETH), which broke out recently to cross the $300 level, currently stands at $321 — up a relatively modest 1.57% in the last 24 hours.

The rise in large-caps also drove up the total cryptocurrency market capitalization by 1.5% to $331 billion, while Bitcoin’s dominance fell by 0.2% and is now at 61.4%, according to data from CoinGecko

Meanwhile, stock markets retreated on Tuesday, with the Nasdaq Composite Index down 1.27% and the S&P 500 down 0.65%. Gold futures prices rose for the second day in a row, however, hitting another record close and intraday high. Moreover, the Federal Reserve has been holding a two-day meeting that started Tuesday, with the results of the meeting to be announced on Wednesday.

OKEx Token Index Board as of 8:00 am UTC on 7/29/20. Source: OKEx
OKEx Token Index Board as of 8:00 am UTC on 7/29/20. Source: OKEx

A hint of risk in a lot of good numbers

The amount of USDT flowing into exchanges recently spiked to a yearly high, according to on-chain data provider Glassnode, and Tether issued another $300 million USDT around an hour ago today. This USDT issuance hints at increasing market demand and could potentially support further Bitcoin price appreciation.

USDT Exchange Inflow. Source: Glassnode
USDT Exchange Inflow. Source: Glassnode

Looking at futures data, OKEx one-month futures annualized basis surged to as high as 25.67% yesterday, its highest level since late February, as per data by skew. Values above 20% indicate that traders are paying a very high premium on spots and using high leverage. 

BTC Futures Annualized Rolling 1-Month Basis. Source: skew
BTC Futures Annualized Rolling 1-Month Basis. Source: skew

At the same time, we note that funding rates for perpetual swaps have been at high levels since Monday. With most traders in profit due to the price increase, the higher funding rates can still be maintained for some time. However, highly leveraged traders may find it difficult to maintain their current positions for prolonged periods.

Funding Rates. Data Collection Time: 7/27 0:00 am UTC to 7/29 8:00 am UTC
Funding Rates. Data Collection Time: 7/27 0:00 am UTC to 7/29 8:00 am UTC

Top gainers and losers

  • HYC/USDT +13.77%
  • MANA/USDT +12.68%
  • GTO/USDT +11.97%
  • FTM/USDT -6.52%
  • NDN/USDT -8.35%
  • BEC/USDT -13.17%

Several small-cap coins are up over 10% in the last 24 hours. Hycon (HYC), which underperformed yesterday, rebounded a quick 13.77% to capture today’s top-gainer rank, while Decentraland (MANA) and Gifto (GTO) realized 12.68% and 11.97%, respectively. 

The biggest loser today is the volatile Beauty Chain (BEC), which is down 13.17%.

BTC technical analysis

Bitcoin rallied quickly after a brief drop near yesterday’s threshold of $10,670. While trading volume did not surge much during the retracement and there are no signs of buyer exhaustion, the resistance around $11,200 will likely limit the short-term upside. 

On the downside, the intraday threshold is still sitting at $10,670. If Bitcoin can continue its upward run to break the $11,200 level, there is a good chance that it will cross $11,500 fairly quickly.

OKEx BTC Perpetual Swap 1h chart – 7/29/20. Source: OKEx, TradingView
OKEx BTC Perpetual Swap 1h chart – 7/29/20. Source: OKEx, TradingView

ETH technical analysis

ETH’s technicals have not changed much since yesterday, and heavy profit-taking could stall further price appreciation for the time being.

On the downside, the strong support level at $299 is still valid, while $322 marks the next resistance — above which, ETH could test its previous high of $334.

OKEx ETH Perpetual Swap 1h chart – 7/29/20. Source: OKEx, TradingView
OKEx ETH Perpetual Swap 1h chart – 7/29/20. Source: OKEx, TradingView


Disclaimer: This material should not be taken as the basis for making investment decisions, nor be construed as a recommendation to engage in investment transactions. Trading digital assets involve significant risk and can result in the loss of your invested capital. You should ensure that you fully understand the risk involved and take into consideration your level of experience, investment objectives and seek independent financial advice if necessary.


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