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The Weekly Report is our summary of key indicators and recent events in the crypto world that professional traders are closely monitoring. This report and other relevant information are first shared via the official League of Traders Telegram channel.

Here are our notes for the third week of November!

1. Bitcoin Chart/Ethereum Chart

The price of Bitcoin (BTC) surged from $81,300 last week to a high of $93,265 and is now stabilizing around $90,000. While spot Bitcoin ETFs experienced record inflows, they recently shifted to an outflow of $400 million, warranting caution. Despite the strong upward momentum established since the U.S. presidential election, the likelihood of a short-term plunge appears low. However, proactive risk management remains crucial in anticipation of potential volatility.

BTCUSDT Chart (Binance)

Spot Bitcoin ETF flows (The block)

Ethereum (ETH) saw its price rise from $3,186 last week to a peak of $3,442 before retreating to $3,117, showing relative weakness compared to Bitcoin. In contrast, Ethereum spot ETFs recorded significant inflows of $295 million, signaling a potentially positive outlook for future price movements.

ETHUSDT Chart (Binance)

Spot Ethereum ETF flows (The block)

Bitcoin dominance increased from 59.49% last week to a peak of about 61% before settling at 60.04%. However, the sharp rise in Ripple (XRP) has limited further growth in Bitcoin’s dominance. If current market conditions reflect the early stages of a major bull cycle, Bitcoin dominance may hold steady at these levels or see a temporary increase.

Bitcoin dominance chart (CoinMarketCap)

2. Major Economic Indicators

• US Bond Yields

Last week, the U.S. 10-year Treasury yield increased from 4.30% to 4.43%. This reflects market adjustments driven by economic indicators signaling persistent inflation risks. While this rise negatively impacted traditional asset markets, Bitcoin demonstrated resilience by maintaining its strong upward trajectory, diverging from traditional market trends.

US10YPrice Government Bond Rate (TradingView)

• US Dollar Index

The U.S. Dollar Index rose from 105.064 to 106.583 last week. This increase appears to be driven by heightened investment demand for the dollar, fueled by expectations of a strong dollar following Trump’s election victory and rising interest rates in the U.S. bond market.

US Dollar Index (TradingView)

• US100 (Nasdaq 100)

The US100 index declined from 21,170 to 20,529 over the past week. This drop is primarily attributed to rising U.S. bond yields, which have exerted downward pressure on the broader market. Current conditions suggest that caution is warranted in the U.S. stock market.

US100 (TradingView)

• Gold Futures

Gold futures prices fell for the second consecutive week, declining from $2,672 per ounce to $2,578. This trend may indicate a shift in capital from safe-haven assets, such as gold, to virtual assets like Bitcoin following the U.S. presidential election. This could be interpreted as a positive signal for the virtual asset market, highlighting increased investor confidence in digital assets.

Gold Futures (TradingView)

3. Bitcoin Market Data

• MVRV Z-score

The MVRV Z-Score has risen from 2.60 last week to 3.02 this week, indicating that the market remains in overbought territory. This suggests heightened caution is necessary as short-term volatility may increase. If the MVRV Z-Score approaches 6, it could signal that the market is nearing a cycle peak and warrants close monitoring.

• Indicator explanation: The MVRV Z-score measures the difference between Bitcoin’s market capitalization and its realized value, divided by the standard deviation. It serves as an indicator to assess whether Bitcoin’s market capitalization is overvalued or undervalued. A score below 0 suggests that Bitcoin is significantly undervalued, while a score of 6 or higher, as seen during the all-time high (ATH) in 2021, indicates an overheated market.

Bitcoin: MVRV Z Score (Glassnode)

• aSOPR

The adjusted Spent Output Profit Ratio (aSOPR) increased from 1.063 last week to a high of 1.098 and currently sits at 1.034. Since it remains above 1, this indicates that the market’s uptrend is still intact, with participants realizing profits overall.

• SOPR, or Spent Output Profit Ratio, is calculated by dividing the price at which Bitcoin was previously received by the price at the time of transfer. A SOPR below 1 indicates a bearish market, while a value above 1 indicates a bullish market. The aSOPR is an adjusted version that excludes short-term transactions (within one hour), providing a more accurate representation.

Adjusted SOPR (Glassnode)

• Open Interest

Open interest in Bitcoin perpetual futures has reached a new record high, rising from $23.16 billion last week to $25.56 billion this week. While the estimated leverage ratio remains steady (0.215 to 0.214), the significant increase in open interest suggests a large inflow of capital into the futures market. This heightened activity could lead to increased volatility, emphasizing the need for risk management.

Outstanding Open Interests by Exchanges (Glassnode)

Exchanges’ combined estimated leverage ratio (Glassnode)

4. On-chain data

• Exchange inflows and outflows

Bitcoin continues to experience net outflows from exchanges, a trend that has persisted since Q3. Outflow volumes are increasing alongside the inflow of capital into Bitcoin spot ETFs. These outflows may reduce available supply on exchanges, potentially creating scarcity that could positively influence future price growth.

Bitcoin: Exchange Net Position Change(Glassnode)

• Number of Whale Wallets

The number of wallets holding more than 10,000 Bitcoins has steadily declined over the past six months, possibly indicating that large holders (whales) are selling portions of their holdings or managing risk. Conversely, wallets holding more than 1,000 Bitcoins have rebounded in the short term, suggesting smaller whales may be accumulating assets in anticipation of potential price increases.

Number of Bitcoin wallets holding 10K or more (Glassnode)

Number of Bitcoin wallets holding 1K or more (Glassnode)

5. Last Week’s Major News

• U.S. Considers Strategic Bitcoin Reserves to Support Dollar’s Role as Reserve Currency

As Donald Trump is re-elected as U.S. President, a strategic Bitcoin reserve plan could be on the agenda. Discussions around this idea took place between Trump and several U.S. politicians in July and early August but lost traction due to Bitcoin’s price volatility at the time. Cynthia Lummis, a Republican senator from Wyoming often referred to as the “Bitcoin Senator,” presented the strategic reserve concept during a Bitcoin conference in Nashville last July. In a recent interview with Decrypt, she confirmed that the plan could gain momentum under a Trump administration.

• Satoshi-Era Whale Moves 2,000 Bitcoins After 14 Years

On November 15th, a dormant Bitcoin wallet from the Satoshi era transferred its entire balance of 2,000 BTC to another address. This wallet had remained inactive for approximately 14 years. The transferred Bitcoins, valued at $182 million based on a price of $91,000 per Bitcoin, have sparked interest and speculation in the crypto community about the whale’s intentions.

• Ripple (XRP) Surges 80% Amid Regulatory Clarity Hopes

Ripple (XRP) has skyrocketed by approximately 80% over the past week, driven by growing optimism about a resolution to its long-standing legal battle with the SEC. Further boosting sentiment, major asset managers such as 21Shares have filed applications for XRP-focused spot ETFs, signaling confidence in the token’s regulatory outlook and market potential.

6. Major economic events

Major economic events last week

Last week, new jobless claims fell short of expectations, while retail sales exceeded forecasts, signaling robust consumer spending in the U.S. economy. These indicators continue to sustain inflationary pressures. Federal Reserve Chair Jerome Powell has maintained a cautious stance on rate cuts, weakening market expectations for any near-term easing. With strong economic growth and persistent inflation risks, interest rates are likely to remain elevated for the foreseeable future.

Major Economic Events for the 2nd week of November 2024 (Investing.com)

This week’s major economic events

This week, the key economic indicators to watch are the European Consumer Price Index (CPI) and the U.S. new jobless claims. The European price index is an important indicator of inflationary pressures in the eurozone economy, while the U.S. jobless claims are a measure of the strength of the labor market and its impact on the overall economy. However, it seems more important to monitor the economic indicators being released and the reaction of the U.S. stock market than to watch for changes in U.S. policy.

Major Economic Events for the 3rd week of November 2024 (Investing.com)

Summary

• Positive Indicators:

Continued inflows into Ethereum spot ETFs

Rising aSOPR values

Exchange inflows and outflows

• Negative Indicators:

Rising U.S. 10-year Treasury yields

Outflows from Bitcoin spot ETFs

High open commitments in futures markets

Weak performance in the Nasdaq 100

Market Outlook: Despite unfavorable macroeconomic indicators, Bitcoin has demonstrated relative strength. With declining gold and stock markets, Bitcoin could attract inflows as investors seek alternative assets. However, it remains vulnerable to macroeconomic factors, particularly rising bond yields and broader market sentiment.

While Bitcoin’s current uptrend appears intact, investors should exercise caution as market volatility may increase. Diversified risk management remains essential in this environment.