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 first week of December!

1. Bitcoin Chart/Ethereum Chart

Bitcoin (BTC) has been consolidating, moving from $97,500 last week to $97,700 this week, falling short of breaking the $100,000 threshold. While the inflow of funds into spot Bitcoin ETFs temporarily turned into outflows, it has since shifted back to slight inflows. The overall upward trend for Bitcoin remains intact, with the $100,000 milestone anticipated to serve as a critical indicator for determining the future market trend.

BTCUSDT Chart (Binance)

Spot Bitcoin ETF flows (The block)

Ethereum (ETH) has seen a significant surge, rising from $3,342 last week to $3,712 this week, maintaining its bullish momentum. Ethereum’s DeFi total value locked (TVL) has reached its highest level in two years, while USDT’s circulating supply has reclaimed the top spot, supporting the positive outlook for the Ethereum ecosystem. Additionally, continued fund inflows into Ethereum spot ETFs point to a favorable short-term outlook.

ETHUSDT Chart (Binance)

Spot Ethereum ETF flows (The block)

Bitcoin’s dominance has dropped significantly, from 59.42% last week to 56.65%, as altcoins have shown strong upward trends throughout Bitcoin’s consolidation phase. Digital asset funds have recorded all-time high inflows, with Solana and XRP seeing unprecedented net inflows. Some experts believe the altcoin season has already begun, with projections of up to $1.5 trillion in capital entering the market. In the short term, altcoins are likely to maintain their strength, and if Bitcoin surpasses the $100,000 mark, additional inflows could drive a broader market rally.

Bitcoin dominance chart (CoinMarketCap)

2. Major Economic Indicators

• US Bond Yields

Last week, the yield on the U.S. 10-year Treasury note fell from 4.35% to 4.21%, largely influenced by stabilized consumer price indices. This week, Federal Reserve Chair Jerome Powell’s upcoming remarks may influence market rates. If there are no significant changes in interest rates, the bullish trend in the cryptocurrency market is expected to persist.

US10YPrice Government Bond Rate (TradingView)

• US Dollar Index

The U.S. Dollar Index (DXY) saw a slight decline last week, moving from 106.848 to 106.278. This shift aligns with stabilized U.S. bond yields, suggesting that easing interest rate pressures contributed to dampening dollar strength.

US Dollar Index (TradingView)

• US100 (Nasdaq 100)

The US100 index remained flat, rising marginally from 20,882 to 20,892, entering a triangular consolidation phase near its upper range. Future trends will likely hinge on U.S. policy rate decisions. However, the decreasing number of leading stocks driving the Nasdaq’s strength highlights potential structural vulnerabilities in the market that warrant caution.

US100 (TradingView)

• Gold Futures

Gold futures dipped slightly, from $2,695 to $2,623 per ounce, reflecting reduced market uncertainty post-U.S. elections. Nevertheless, any significant downturn in U.S. equities or major interest rate fluctuations could trigger a rebound in gold prices.

Gold Futures (TradingView)

3. Bitcoin Market Data

• MVRV Z-score

The MVRV Z-Score fell slightly, from 3.33 to 3.24, indicating a pause in its upward trend. This suggests that the market is not yet in an overheated phase, which can be viewed positively.

• 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

Similarly, the aSOPR metric dropped from 1.049 to 1.038 but remains above 1, signaling a continuation of the overall bullish trend.

• 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 decreased slightly, from $28.95 billion to $28.82 billion, with the estimated leverage ratio declining from 0.235 to 0.219. While still high, the reduced risk level amid the uptrend signals a healthy market adjustment. Meanwhile, net Bitcoin outflows from exchanges have reached their highest levels this year, leading to a supply squeeze. This trend could prompt sharp price increases due to diminishing sell-side liquidity.

Outstanding Open Interests by Exchanges (Glassnode)

Exchanges’ combined estimated leverage ratio (Glassnode)

4. On-chain data

• Exchange inflows and outflows

Net outflows of Bitcoin from exchanges continue, reaching their highest levels this year. As exchange-held Bitcoin supplies dwindle, the reduced availability of sell-side liquidity could lead to sharp price increases, creating a potential scenario for a significant rally.

Bitcoin: Exchange Net Position Change (Glassnode)

• Number of Whale Wallets

However, wallet activity presents a mixed picture. While the decline in the number of wallets holding more than 10,000 BTC has halted, these wallets remain at their lowest levels of the year. Similarly, wallets holding over 1,000 BTC have shown a flat trend, indicating a lack of active re-accumulation at the current price range. This stagnation in large-scale accumulation suggests a potential bearish undertone and points to limited institutional confidence at present price levels.

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

5. Last Week’s Major News

• MicroStrategy Acquires 55,500 BTC, Total Holdings Exceed 386,700 BTC

MicroStrategy, a prominent Bitcoin investment company, recently purchased an additional 55,500 BTC, as reported by international media on November 25. The acquisition, made between November 18 and 24, was disclosed via an 8-K filing with the U.S. Securities and Exchange Commission (SEC). The average purchase price was approximately $97,862 per Bitcoin, with a total expenditure of $5.4 billion. This purchase brings the company’s total Bitcoin holdings to 386,700 BTC, further solidifying its position as a major institutional investor in the cryptocurrency market.

• Hashed CEO: “Tax Deferral to Accelerate Web3 Institutionalization in South Korea”

The two-year deferral of cryptocurrency taxation in South Korea is expected to accelerate the institutionalization of the crypto and Web3 industries. On December 1, Simon Kim, CEO of Hashed, shared his insights on X (formerly Twitter), emphasizing the key tasks necessary for fostering Web3 growth in the country. The postponement of taxation could provide the domestic blockchain sector with much-needed momentum to expand its influence and capabilities.

• Uniswap Hits Record Monthly Trading Volume as DeFi Market Gains Momentum

Uniswap, the decentralized exchange (DEX), achieved a record-high monthly trading volume of $38 billion in November. According to CryptoPolitan on November 28, this figure represents a 50% increase from October’s volume of $20.32 billion and surpasses the previous peak of $34 billion set in March by $4 billion. This surge signals a strong revival of activity in the decentralized finance (DeFi) market.

6. Major economic events

Major economic events last week

Consumer price indices (CPI) in the U.S. and Europe were released within expected ranges, while U.S. new home sales declined, and Treasury yields continued to fall. These developments contributed to stability in both the U.S. stock market and gold prices while the cryptocurrency market maintained its upward momentum.

Major Economic Events for the 4th week of November 2024 (Investing.com)

This week’s major economic events

This week’s major events include the U.S. Department of Labor’s JOLTS (Job Openings and Labor Turnover Survey) on Wednesday and a speech by Federal Reserve Chair Jerome Powell on Thursday. As the crypto market exhibits a clear bullish trend, investors should pay close attention to the potential impacts of U.S. policy shifts on broader financial markets.

Major Economic Events for the 1st week of December 2024 (Investing.com)

Summary

Positive: Bitcoin Dominance, U.S. Treasury Yields, aSOPR, Open Interest in Bitcoin Futures

Negative: U.S. Bitcoin Spot ETF Outflows, Decline in Whale Wallets

Market Outlook: Bitcoin is currently in a consolidation phase after recent gains, while altcoins are demonstrating significant strength. The possibility of Bitcoin attempting to break the $100,000 threshold remains open. The altcoin rally is likely to persist this week, presenting opportunities for investments in technically strong altcoins that have not yet surged. Identifying undervalued assets with breakout potential could yield favorable outcomes for investors.