CoinDesk reviewed this selloff a few hours ago: The Fed stood pat in the early hours today, leaving rates at 3.75%–4%. Chair Warsh struck a hawkish tone after the meeting, saying inflation is still too high. An hour after Seoul opened this morning, $BTC fell from 81,700 through 80,000, hitting a low of 79,614. Market-wide futures liquidations over 24 hours totaled $356 million, including $205 million in long positions. The trigger was Samsung Electronics: its chip division posted operating profit of 106.5 trillion won, just short of the 108.5 trillion forecast, and its shares fell more than 5%. The Kospi dropped 2%, while Nasdaq futures fell 1.4%.
Put simply, this doesn't look like panic to me: Deribit's funding rate was basically unchanged at 0.0019% every eight hours, with no rush to add shorts. Perpetual open interest fell from $802 million to $747 million—old leverage is being unwound, not new shorts entering the market—and 58% of liquidations were longs. In any case, I'm more interested in tonight's U.S. third-quarter GDP and September PCE data at 20:30. If the daily close can't reclaim Wednesday's 81,287 within three days, this will count as a trend reversal, not a shakeout.
Put simply, this doesn't look like panic to me: Deribit's funding rate was basically unchanged at 0.0019% every eight hours, with no rush to add shorts. Perpetual open interest fell from $802 million to $747 million—old leverage is being unwound, not new shorts entering the market—and 58% of liquidations were longs. In any case, I'm more interested in tonight's U.S. third-quarter GDP and September PCE data at 20:30. If the daily close can't reclaim Wednesday's 81,287 within three days, this will count as a trend reversal, not a shakeout.
