BTC VOLATILITY WEEK REVIEW (27 OCTOBER-3 NOVEMBER)

Core indicators (27 October: 16:00: 3 November: 16:00)

• BTC/USD 7.3% DOWN ($115,600 - > $107,200)
• ETH/USD DECLINE 12.1% (USD 4,200 - > USD 3,690)

• markets continued to shock internally between $104/105k and $115/116k. despite the absolute narrowness of the wave band, real volatility remains high – an indication of the difficulty of the market finding a balance, confusion about the disconnect between encrypted currency and the technocratic unit/high-beta unit, and concern that gold/precious metals may have a more substantial return. on the technical side, we expect the market to start another wave of decline to complete the current flat wave of adjustment, which may be the first of three flat adjustments that may last for months (or years?), but we may also see markets continue to shock in the coming weeks。

Market theme

• THE FOCUS OF THE MARKET OVER THE PAST WEEK HAS BEEN ON THE FOMC MEETING, THE UNITED STATES FINANCIAL PAPER AND THE TRUMP-SU JINPING MEETING. AS A RESULT, THESE THREE THINGS HAVE MAINTAINED A RISK-BIASED ENVIRONMENT: THE FED, AS EXPECTED/NEEDED, REDUCED INTEREST RATES BY 25 BASIS POINTS, ALTHOUGH POWELL TRIED TO DILUTE THE INTEREST-RATE-REDUCTION EXPECTATIONS OF DECEMBER (`NEVER ESTABLISHED FACTS'), THIS WAS ONLY A SMALL EPISODE THAT DID NOT HAVE A SIGNIFICANT IMPACT ON MARKET EXPECTATIONS; DESPITE CONCERNS ABOUT THE SLOWDOWN IN THE REAL ECONOMY, US CORPORATE FINANCES HAVE GENERALLY BEEN VERY ROBUST; AND THE TRUMP-SUZEN MEETING ENDED WITH A BREAKTHROUGH, WITH TARIFF RATES BEING LOWERED AND CONCESSIONS MADE, AND AN AGREEMENT NOW ALMOST CERTAIN。
• DESPITE THIS, IT IS ONCE AGAIN DIFFICULT FOR THE ENCRYPTED CURRENCY TO STAND ON ITS FEET AND FOR THE ORIGINAL “BIG WHALE” TO REMAIN IN SILOS, MAKING IT DIFFICULT FOR BTC AND ETH TO STAND ABOVE $115,000 AND $4,000. THE OPPORTUNITY COST OF HOLDING A ENCRYPTED CURRENCY REMAINS HIGH AS THE PPI/NASDAQ INDEX AND THE GOBERTAAI SHARES CONTINUE TO RISE. AT THE SAME TIME, THE MARKET'S EXPECTATIONS FOR THE 25 BASE POINTS THAT FELL IN DECEMBER FELL FROM 90 PER CENT TO NEARLY 50 PER CENT, OWING TO THE MITIGATING REBOUND OF THE GOLD DOWN TO THE $4,000 DOLLAR, AND THE UNITED STATES DOLLAR WAS GENERALLY STRONGER AGAINST THE G10 CURRENCY. MANY DAT COMPANIES HAVE ALSO REDUCED THEIR NET VALUE TO (OR LESS) 1.0 TIMES, AND THE NARRATIVE HAS LOST ITS APPEAL。

BTC IMPLIED VOLATILITY

• The overall implied volatility rate is organized across the week and the actual volatility rate is maintained in the early 40s (hour-scale HF), confirming the correctness of the implied fluctuations to that level. That said, most of the actual volatility was driven by last week ' s reaction to events (FOMC meetings and Trump-Siouping meetings) and, on a lower-frequency basis, has been declining as currency fluctuations subsided to a narrower range of $106-112k. This put some pressure on the short-term Gamma deadline before the weekend, but as the prices returned to $107 k on Monday, the pressure quickly disappeared as the market remained less liquid than before。
• THE DURATION STRUCTURE OF THE IMPLIED VOLATILITY RATE REMAINED LARGELY UNCHANGED AND THE STEEPNESS WAS UNDERPINNED BY MACRO-DYNAMICS, AS THE OVERALL LEVEL OF DATA IN THE UNITED STATES IN NOVEMBER (AND THERE WAS NO FOMC MEETING) BECAME THE END OF THE YEAR OF INTENSE EVENTS。

BTC/USD BIAS/PEAK

• over the past week, the bias towards falling options has generally advanced, as the real volatility of the top is still low, with a large stock of sales in the 112-116k zone, while the downward fluctuations continue to show high real fluctuations. the market appears to have significant risks below $106k, leading to a once-drive decline to a very deep level on thursday, which is difficult to sustain unless we see a substantial breakthrough in currency prices。
• as last week's spot was locked at $106-112k, peak prices continued to fall, with good liquidity support on both sides of the zone (i.e., when prices were near the edge of the zone, there was no extreme movement in currency prices). there are still a large number of risk exposures for the directional construction of price differentials, which also provides a sales pressure for peaks. volatility rates remain slightly higher on a local scale, but less extreme than in the past few weeks, which also helps to temporarily contain peaks。

Good luck with the new week