- Bitcoin is trading steadily near $110,300 as the market consolidates.
- After the recent Fed meeting, traders have largely stopped adding new risks.
- Bitcoin’s dominance has risen to around 60% of the total cryptocurrency market.
A cautious calm settled in crypto markets at the start of the week, with Bitcoin holding steady above the key $110,000 level as traders liquidated positions and reassessed risks following last week’s hawkish signals from the US Federal Reserve.
Although markets have stabilized after a period of volatility, underlying data from derivatives and credit markets suggests that a “wait-and-see” approach is now the prevailing strategy as investors look for new catalysts to make the next big move.
At the start of business week in Hong Kong, Bitcoin was trading around $110,300, while Ether was hovering around $3,880. Both assets remain down significantly by 10% and 14%, respectively, over the past 30 days.
Market maker Flowdesk said its clients have largely “paused the addition of new risks” since the Fed meeting, with market activity dominated by short-term trading and portfolio rebalancing.
Despite the caution and the lag in Solana-related assets, traders were net buyers of tokens with strong underlying fundamentals such as BTC, HYPE, and SYRUP, Flowdesk noted.
This deleveraging left many traders with “a lack of exposure should the market recover,” suggesting cleaner market positions, the company wrote.
Fears remain in the derivatives market
Although the spot market appears to have calmed down, there are still signs of fear in the derivatives industry. According to CoinGlass data, approximately $155 million in crypto derivatives were liquidated in the past 24 hours.
The split, which wiped out $97 million in long positions and $58 million in short positions, indicates a modest flash of over-leveraged bullish bets rather than widespread panic selling.
Flowdesk observed “increased put skew and continued caution despite calming volatility,” indicating that traders are still buying downside protection.
This cautious position, dominated by long puts and short calls, could present an opportunity once the market stabilizes.
“Cheap risk reversals could become attractive once the spot market stabilizes,” Flowdesk wrote, adding that volatility is likely to “decline toward the end of the year.”
Gold continues to rise despite Fed hawkishness
In the broader macroeconomic picture, gold has maintained its recent gains despite headwinds from the Fed.
Precious metal prices closed at about $4,003 an ounce on Friday, up 3.7% in October and the third straight month of gains.
Demand for gold remains strong, even as the Fed’s hawkish comments and a stronger dollar reduce the likelihood of a December rate cut.
Persistent geopolitical tensions and ongoing US fiscal uncertainty continue to support the metal’s appeal as a stable asset.
