Here’s a tighter, fully rewritten version:
Bitcoin eased back after briefly touching a two-week high of $64,500, with declining open interest and weak spot demand casting doubt on the durability of July’s 8.4% advance. Tuesday’s drop marked the first pullback of the month, snapping its longest winning streak since March.
Ether followed suit, retreating to $1,770 after reaching $1,830 a day earlier.
The broader recovery seen in July has been largely driven by a short squeeze that began taking shape in late June, when bearish positioning remained elevated even as bitcoin hovered near yearly lows. As those positions unwound, prices rebounded from oversold levels, fueling a steady climb across the crypto market.
Since the start of the month, the total crypto market cap has risen 8.4% to $2.16 trillion.
At the same time, U.S. equity futures moved lower, with Nasdaq 100 contracts falling 0.9% in early trading, extending the retreat from June’s record highs.
Derivatives positioning
More than $500 million in leveraged crypto futures positions were liquidated over the past 24 hours, with short positions accounting for the majority for a sixth consecutive day.
Despite recent price gains, bitcoin’s futures open interest has slipped to 740K BTC from 776K BTC earlier in July. This suggests derivatives traders are not strongly backing the rally, while continued weakness in spot demand—reflected in ETF flows and the Coinbase premium—raises concerns about its staying power.
A similar pattern is emerging in ether, which had recently outperformed bitcoin.
Solana’s open interest has also declined, falling to 68 million tokens from over 76 million in late June, indicating that its recent 10% price increase has not drawn significant leveraged interest.
Meanwhile, Canton Network’s CC token dropped more than 4% in the past day, even as open interest rose 3% to 245.59 million tokens. Combined with negative funding rates and weak volume signals, this points to a growing bearish bias.
Across the market, many tokens are showing negative open-interest-adjusted cumulative volume delta, suggesting more aggressive selling through market orders—often a signal of potential downside risk.
Volatility and options
Bitcoin’s 30-day implied volatility index (BVIV) has climbed to 40%, breaking a six-day losing streak. However, it remains well below January’s highs near 60%, which could still support a constructive outlook. Ether’s volatility index reflects a similar trend.
Options markets on Deribit show mixed sentiment, with both bullish and bearish contracts ranking among the most actively traded, highlighting uncertainty around near-term direction.
On the decentralized exchange Derive, a large call condor strategy on HYPE suggests expectations for price consolidation between $75 and $80 through July 24.
Token trends
Altcoins are showing mixed performance. Tokens like FET, KASPA, and WLD have declined despite the broader market recovery, while ETHFI and LIT have surged more than 30% over the past week.
WLFI stood out with a 4.8% gain on Tuesday, although it remains down more than 89% since its launch last August.
This divergence reflects a more mature market, where individual token performance is increasingly driven by fundamentals and on-chain activity rather than broad market momentum. In the past, altcoins tended to move in sync.
CoinMarketCap’s Altcoin Season Index currently sits at 46 out of 100—below last week’s peak but above May levels, when it hovered closer to 30.
