Trading firm QCP Capital has released a fresh report analyzing the market situation after the historic agreement between the US and China on a temporary reduction of mutual tariffs. According to the document, American tariffs on most Chinese goods will drop from 145% to 30%, while China will reduce fees on American products from 125% to 10%.
This diplomatic thaw has triggered a sharp rise in risk appetite — American stocks opened with a gap up of 3% as markets began to factor in the possibility of a recovery in cross-border capital flows.
Gold, traditionally serving as a safe haven asset during periods of uncertainty and protectionism, reacted with a nearly 3% drop, although it later partially recovered. The return to a more traditional macro regime (strengthening of the US dollar, rising yields on Treasury bonds, weakening of gold) triggered a new wave of volatility selling across various asset classes. The VIX index fell to 18 points, while Bitcoin's volatility at the near end of the curve decreased by more than 5 points.
Bitcoin and Ethereum: Divergent movements
Bitcoin and Ethereum initially declined after the tariff announcement but have now stabilized around $103,000 and $2,400, respectively. However, signs of capital rotation are observed beneath the surface. Bitcoin's dominance has fallen below 63%, while altcoins, particularly Ethereum, are starting to outperform the first cryptocurrency.
1-day Bitcoin dominance chart
According to QCP Capital analysts, Bitcoin remains in a contradictory position between the role of 'digital gold' and a proxy asset with increased risk. This contradiction continues to complicate the formation of a clear directional movement. As the macroeconomic narrative shifts from protectionism to a revival of trade optimism, Bitcoin may remain in a sideways movement.
Nevertheless, a broader shift can affect derivative flows. Longer investment horizons typically support demand for long-dated options, reduce the need for hedging with near-term puts, and contribute to an increase in the steepness of the volatility curve.
Ethereum is forming a clearer picture
Ethereum, on the other hand, is demonstrating a clearer dynamic. Funding remains neutral, and options are skewed towards puts relative to calls, indicating that the breakout is not driven by speculative activity. The net movement above $2,400 coincides with the rollout of the Pectra upgrade.
QCP Capital analysts also note a resurgence of longer-dated option flows, which may be an early sign that Ethereum is positioning itself as the next major target for capital distribution in the market.
The trading strategies recommended by QCP Capital are based on the current market situation. Let's take a closer look at the main directions.
Trading strategies for the current market
QCP Capital suggests considering strategies that take into account the new macroeconomic regime. One of the key ideas is to use options structures that can benefit from the changing shape of Bitcoin's volatility curve.
The calendar spread strategy for Bitcoin involves simultaneously selling short-term options and buying long-term ones. This allows the trader to benefit from lower volatility in the near term while maintaining exposure to potential long-term movements. Such an approach may be particularly effective now, as Bitcoin's short-term volatility has significantly decreased.
For Ethereum, analysts suggest considering strategies aimed at continued growth. One option is to buy call options with target levels above the current price ($2,400), which can yield significant profits in the event of further rises. Given that the current options skew favors puts, the cost of such calls may be relatively attractive.
The bullish call spread strategy for Ethereum can be implemented by simultaneously buying call options with a lower strike and selling options with a higher one. This limits both potential profit and possible losses but helps reduce the overall cost of the position.
The macroeconomic changes described in QCP Capital's report create a new reality for cryptocurrency markets. The reduction of tariffs between the US and China stimulates global financial flows and changes investors' risk attitudes. Under these conditions, Bitcoin may temporarily lose some of its appeal as a safe haven asset but will retain its fundamental value. Ethereum, with technological upgrades and growing institutional interest, is forming its own growth trajectory, as evidenced by the increase in long-term option volumes.
