The crypto market consolidated, with bitcoin BTC$113,335.37 falling back to $113,100 and ether ETH$4,017.01 continuing to grapple with the psychological level of support at $4,000.

There are two key catalysts from a macro perspective this week: the Federal Reserve interest-rate decision due later Wednesday and a potential trade deal between the U.S. and China.

The market is anticipating a rate cut to 375-400 basis points (bps), although it’s worth noting that if the Fed holds rates steady at 400-425, the market will likely sell off because the dollar will rally.

Meanwhile in the Far East, China’s President Xi Jinping will meet U.S. President Donald Trump as a deal nears a conclusion. An agreement is likely to boost U.S. equities and, by proxy, bitcoin because the largest cryptocurrency is positively correlated with the U.S. stock market.

By Saksham Diwan

• The BTC futures market is holding steady, with open interest (OI) at $26.8 billion.
• Funding rates, however, are highly divergent: Deribit shows an aggressive spike to 24.64% annualized, signaling strong demand for long positions, while OKX dipped to -3%, where shorts are being paid.
• This mix of sustained high OI and polarized funding rates indicates elevated near-term market volatility and uncertainty, disrupting the previously uniform bullish sentiment.
• In the options market, bitcoin is showing a strong surge in bullish conviction. The implied volatility (IV) term structure is displaying a slight near-term backwardation (downward slope) before normalizing into long-term contango (upward slope).
• Short-term bullish sentiment has increased significantly, with the 250-delta skew at 10% for the one-week expiry, meaning traders are paying a substantial premium for call options. This is further validated by the 24-hour put-call volume, whic is strongly in favor of calls (60%).
• Coinglass data shows $514 million in 24 hour liquidations, with a 69-31 split between longs and shorts. ETH ($155 million), BTC ($114 million) and SOL ($57 million) were the leaders in terms of notional liquidations.
• The Binance liquidation heatmap indicates $114,350 as a core liquidation level to monitor, in case of a price rise.

By Oliver Knight

• The altcoin market began to show signs of strength on Wednesday, with traders rotating into higher-beta tokens ahead of potential policy headlines.
• The TRUMP token, touted by President Donald Trump in January, led the move, rallying as optimism grew that the U.S. and China are closing in on a trade agreement.
• AERO$0.9903 also rose, buoyed by steady activity across Base-based DeFi protocols. The token added 7.2% as it notched its highest level since the start of the month.
• The market still showed a preference for bitcoin, with CoinMarketCap’s “altcoin season” indicator remaining at 26/100.
• The altcoin gains were confined to memecoins and DeFi tokens, while larger tokens traded in tight ranges.
• ENA$0.4624 and hedera (HBAR) both gave back much of their gains on Wednesday, with the former down by 6.9% in 24 hours while hedera dropped by 4.5% despite a spot HBAR ETF going live on the NYSE on Tuesday.