This biweekly report provides a comprehensive analysis of cryptocurrency market dynamics and trends through multi-dimensional data analysis. The report covers key indicators such as volatility, long-short trading volume ratio, open interest, and funding rates for major cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH), while also examining liquidation trends in crypto derivatives. Additionally, the quantitative backtesting section delves into the MACD indicator, evaluating its effectiveness and historical returns.

Key Takeaways:

• Market Volatility & Diverging Long/Short Sentiment: BTC exhibited significantly higher volatility than ETH, transitioning from a downward consolidation to a sharp rebound, reflecting a stronger market reaction to BTC movements. The BTC long-short ratio remained within the 0.90–1.10 range, indicating underlying market support, while ETH struggled with weak rebounds, keeping its trading ratio at lower levels and leading to widening liquidity divergence.
• Deleveraging & Increased Funding Rate Volatility: BTC funding rates experienced intensified fluctuations, with a rise in long liquidations and a decline in open interest, suggesting that the market may be undergoing a deleveraging phase or short-term liquidity contraction. Meanwhile, ETH leveraged positions remained cautious, with relatively stable open interest, reflecting a lack of confidence in ETH’s near-term price outlook.
• Solana Meme Asset Hype Fades Rapidly: The daily issuance of Solana-based meme coins dropped to 40,000, marking a 65% decline from its January peak. As speculative enthusiasm cooled, Solana’s total gas fee revenue, on-chain trading volume, and active address count declined simultaneously, signaling that the meme sector has entered a contraction phase, with liquidity and ecosystem activity under pressure.
• Strong Performance of Standardized MACD Backtesting: The quantitative analysis section conducted backtesting on the standardized MACD strategy, which normalizes MACD values within a fixed range to enhance price reversal detection after excessive rallies. The results showed that holding positions for over 30 cycles yielded a cumulative return of 25%, with a Sharpe ratio significantly outperforming short-term strategies, demonstrating strong mid-to-long-term profit potential.
• Market Outlook & Strategy Implications: The market is undergoing a structural shift, with diverging BTC and ETH short-term trends, a rebalancing of leveraged positions, and a retreat in meme asset speculation. Moving forward, traders should focus on global macroeconomic policy shifts, funding rate trends, and the performance of quantitative strategies in high-volatility conditions. Adapting position sizing and trading strategies will be crucial in managing the risks associated with increased market fluctuations.

Gate Research
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Gate.io Team
March 7, 2025