QCP Capital Market Update – 2 Apr 24
– Once again, the options market provided an early signal to a sharp downside move, particularly the downside skew in risk reversals.
– BTC broke 70k and traded below 66k. ETH traded to 3320 lows.
– The speed of the move was due to large liquidations on retail-heavy exchanges like Binance which saw perp funding rates go from as high as 77% to flat.
– The move brings spot prices right back into the middle the 60-72k range.
– While perp funding has compressed, the rest of the forward curve remains very elevated. Will this be the move that brings the whole curve back down?
Trade Ideas:
1. Sell Spot-Forward Basis which is still yielding 20% for zero downside.
2. Strategies that do well in range-y market like Accumulators, UFCC/CFCC and Range Accruals.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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