Bitcoin and ether inched higher overnight, but fragile altcoin participation, elevated liquidations and persistent demand for downside hedges underscore a market that remains defensive.

Bitcoin gained about 0.9% to trade near $67,000 after briefly sliding to $66,000 on Wednesday. Ether rose by a similar margin to around $1,970, rebounding from $1,924 yet again failing to convincingly break above the key $2,000 psychological barrier.

Volatility has cooled markedly since the Feb. 5 selloff. Two weeks of sideways consolidation have left investors questioning whether the market is carving out a macro bottom ahead of a broader recovery into 2025, or merely pausing before another leg lower.

A Mar-a-Lago forum organized by World Liberty Financial did little to lift sentiment, despite the presence of CFTC Chairman Michael Selig and senior executives from Goldman Sachs. The event failed to deliver a meaningful bullish catalyst.

Technically, bitcoin remains in a broader downtrend after topping out near $126,600 in early October. The structure continues to show a sequence of lower highs and lower lows, punctuated by periods of choppy range-bound trading.

Derivatives positioning

Open interest has stabilized around $15.38 billion, suggesting the earlier phase of forced deleveraging has transitioned into a more balanced footing.

Retail sentiment has improved modestly, with funding rates flipping from negative to flat or slightly positive — Binance funding has returned to roughly 4%. Institutional conviction, however, remains restrained, as the three-month annualized futures basis holds near 3%.

In options markets, call and put volumes are evenly split, pointing to neutral directional bias. The one-week 25-delta skew has ticked up to 12%, while the implied volatility curve remains in short-term backwardation. Elevated front-end implied volatility indicates traders are still paying a premium for near-term protection, even as longer-dated contracts stabilize around 49%.

According to CoinGlass, total liquidations reached $218 million over the past 24 hours, with 77% stemming from long positions. Bitcoin accounted for $75 million in liquidations, ether for $53 million and other tokens for $22 million. Binance’s liquidation heatmap flags $67,400 as a key upside level where additional liquidations could cluster.

Altcoins under pressure

Altcoins are struggling in the current low-liquidity environment.

WLFI dropped more than 10% in a classic “sell-the-news” reaction following Wednesday’s event. Axie Infinity’s AXS token is retesting its Feb. 6 lows after falling 5.9% since midnight UTC. Lending protocol Morpho’s MORPHO token has erased all of Wednesday’s gains, trading near $1.39 after declining 4.2% overnight.

Breadth remains notably weak: 97 of the top 100 cryptocurrencies — excluding stablecoins and tokenized gold tokens — are in negative territory over the past 24 hours.

Sentiment metrics reinforce the cautious tone. The crypto fear and greed index stands at 11 out of 100, up slightly from February’s low of 6, but still firmly entrenched in “extreme fear.”