- BTC gained 2.6% during low-volume holiday trading.
- Elevated funding rates suggest possible upside volatility.
- Market awaits stronger liquidity to confirm direction.
Bitcoin (BTC) saw a modest rise of around 2.6% during a typically quiet holiday trading session. According to QCP, the move was largely driven by spot and perpetual futures buying rather than liquidations. This indicates that the upward momentum came from active positioning, not forced exits.
Despite the price bump, the broader crypto market remains cautious. The surge happened in an environment with thin trading volumes, meaning fewer participants were involved, and any significant trades had a stronger impact on price movement.
Funding Rates Point to Bullish Risk
A key indicator to watch is the perpetual funding rate, which remains elevated. This suggests that traders are willing to pay a premium to hold long positions, reflecting bullish sentiment. Analysts believe this could result in upside gamma risk if BTC manages to hold above the ~$94,000 mark.
Gamma risk refers to the potential for sharp price swings due to changes in options positions. If BTC continues to climb, it could trigger more buying from market makers needing to hedge their positions — amplifying the move higher.
Conviction Still Weak Without Liquidity
While there’s been a pullback in downside hedging, showing that traders are slightly less fearful of a price drop, overall conviction in the market remains low. Open interest — the total value of outstanding derivatives contracts — has dropped significantly, pointing to reduced participation.
Traders are waiting for normal liquidity levels to return after the holidays before making stronger directional bets. Until then, the BTC price outlook remains uncertain, and any price moves should be taken with caution.
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