Risk-off wave drags bitcoin below $63,000 as AI selloff spreads from stocks to crypto

One cause for optimism heading into the weekend is that the average relative strength index (RSI) across crypto pairs. The reading has dipped to 42.23, approaching the oversold conditions that triggered July’s relief bounce.

• The long-short ratio in crypto futures markets, as measured by taker buy-sell volume, has slipped to 0.94, the lowest since June 2.
• A “taker” is the entity executing a trade at the current market price, and the ratio indicates which side of the transaction is being more aggressive with market orders. The latest reading suggests that bears are currently in control, validating the price declines seen over the past 24 hours.
• That said, overall volume has cooled by 4% in 24 hours to $163 billion, while open interest (OI) remains largely steady at around $111 billion. This suggests that while buy-sell volume is skewed bearish, overall market activity has declined during the price drop.
• BTC’s total OI has pulled back to 747K BTC from yesterday’s high of 755K BTC. A similar trend is evident in ETH, XRP, and SOL futures, where OI has held steady or declined slightly.
• These changes indicate that major token futures are not yet showing signs of aggressive new shorts entering the market or panic unwinding due to margin calls. For now, it remains an orderly price drop.
• HYPE stood out with an OI increase of nearly 2% alongside a sharp 8% drop in the spot price. This combination typically confirms price weakness, signaling that new short positions are being opened. Furthermore, the 24-hour OI-adjusted cumulative volume delta (CVD) for HYPE is the most negative among major tokens, matching memecoin DOGE. A negative CVD implies that sellers are being aggressive, shorting at market prices rather than using passive limit orders.
• The broader market picture appears equally bearish, as most coins, including BTC and ETH, display a negative 24-hour CVD.
• However, bitcoin and ether’s 30-day implied volatility indexes remain near recent lows, signaling continued market stability. Put simply, while spot prices have dropped, the selloff has yet to trigger panic buying of options or a rush for hedging contracts.
• In ether’s case, a trader or a group of traders recently purchased large-scale straddles, betting on significant price swings by July 24.
• Regarding volumes, three of the top five most-traded ETH contracts are currently puts. A put option offers protection against price declines in the underlying asset. Yet, at the same time, the $2,100 call remains the single most-traded bet of the past 24 hours. For bitcoin, the $62,500 put has emerged as the clear favorite among traders.

• Lighter (LIT) led the losses on Thursday, falling 3.55% to $2.195 as profit-taking weighed on a token that surged more than 200% between May and early July.
• Privacy coins bucked the trend with zcash (ZEC) advancing 1.56% to $531 and dash (DASH) gaining 0.78%, both maintaining the relative strength they have shown in recent weeks.
• AI tokens FET and TAO posted gains of about 0.20%, a sign of resilience from a sector that has struggled to sustain momentum since mid-June.
• CoinMarketCap’s Altcoin Season indicator snapped back to 53/100 on Friday, highlighting bitcoin’s relative weakness against several altcoin trading pairs.