Market update
Crypto markets traded sideways again this week, with Bitcoin flat on seven days ago and trading around A$40,550 (US$26,025). Ethereum lost 1.3% and finished the week at A$2,570 (US$1,650). XRP and Cardano were flat, Dogecoin was up 1.4%, while Solana fell 3%. There is some good news, with Bloomberg analysts arguing the recent downtrend in Bitcoin prices is weakening, and the liquidations are “largely behind us” based on a decline in open interest. “As a result, we see limited downside for crypto markets over the near term,” their report stated. However, with the war on crypto in full swing and the US Fed boss Jereme Powell indicating inflation is still too high and that “we are prepared to raise rates further if appropriate” it’s anyone’s guess where markets will go next. Analyst Michael van de Poppe says that nearing 500 days, we’re in “the longest bear market in history for Bitcoin”. The Crypto Fear and Greed Index is at 39 or Fear.
Bitcoin’s months-long sideways action ended with a bang late last week when the price dropped about 8% in ten minutes on Friday. Around US$2.5 billion of open interest in derivatives markets was cleared out in a few hours. The likely catalyst was some reheated old news about SpaceX writing down its BTC holdings and selling, but there are also fears over the Chinese economy, speculation about potential US interest rate rises, and the possible price impact of a rise in government bond yields. Bitcoin finishes the week down 11% to trade at US$26.1K, while Ethereum fared slightly better with a 10% drop to US$1,670. Everything else lost ground significantly, including XRP (-17%), Cardano (-9%), Dogecoin (-16%) and Solana (-16%). After a few months at Neutral, the Crypto Fear and Greed Index has fallen to 38, or Fear.
Back in the day, the merest rumour of a PayPal stablecoin would have ushered in a mini bull run, but in this era of SEC-induced uncertainty, it barely nudged the dial. Glassnode analyst Checkmate notes the spread between the upper and lower Bollinger Bands is just 2.9% — the third lowest volatility since 2015. Traders are so bored they’re pumping money into a meme coin called HarryPotterObamaSonic10Inu. Macro trends could be bad for Bitcoin, however, with Michael ‘The Big Short’ Burry opening his biggest leveraged short positions since his famous 2008 recession prediction. Bitcoin finishes the week flat at $45,410 (US$29,437), while Ethereum gained 1% to trade at $2,845 (US$1,844). Cardano was flat, while Ripple (1.6%), and Dogecoin (1.8%) moved a little, and Solana increased 9.4%. Tether has been trading a fraction below its $1 US peg for a few weeks now, which is slightly concerning. The Fear and Greed Index remains at 50 or neutral.
It was all quiet on the crypto front again this week, with no big moves. Bitcoin’s total transfer volume in USD has dropped to a three-year low, and its one-month volatility is at 22.9% (which is less than half the one-year volatility of 49.1%). Bitcoin has been mostly trading between A$43K to A$45K (just under US$30K) which is the same ballpark it’s been in since March. Bitcoin finishes the week flat on seven days ago at $44,420 (US$29,140), while Ethereum is down 1.7% to trade at A$2,780 (US$1,825). Euphoria over XRP’s court victory has dissipated, with the token falling 11.2%, Dogecoin losing 5.8%, Cardano (-5.8%) and Solana (-3.1%). The Crypto Fear and Greed Index remains at 49 or Neutral. Barring a major collapse or the passing of crypto legislation in the US, the next big market-moving event could be the potential approval of a spot Bitcoin ETF or an Ethereum Futures ETF which some pundits are tipping for October.
Another week of sideways price action saw Bitcoin trading around the A$43K/US$29K mark with no major moves. Ethereum traded mostly in the $100 range around A$2,800. Fittingly the Crypto Fear and Greed index is at 50 or Neutral. Bitcoin finishes the week pretty much where it was seven days ago at A$43,210 (US$28,970) while Ethereum is down just over 1% and is trading around A$2,730 (US$1,825). XRP didn’t budge even after Wells Fargo’s Treasury Management officer Shannon Thorp predicted it could hit US$100 to US$500 (A$149 to A$745) which would give it a market cap slightly higher than America’s GDP. Cardano, Dogecoin, and Solana also traded around the same price as seven days ago.
It’s been a fairly quiet week for Bitcoin, which has been trading just above, and just below, the US$30K mark. It’s currently trading around US$29,100, down 3% on seven days ago. Ethereum has been almost as dull, although the trend was slightly downward, and it finishes 3% down at US$1,849. XRP (-5%), Cardano (-3%), and Solana (-13%) all eased while Dogecoin traded flat. The Fear and Greed Index is at 50 or Neutral. It’s shaping up as an interesting week in finance and the economy more broadly, with Microsoft, Google, Visa and Meta all releasing earnings reports and a 25bps interest rate hike expected in both the US and the Eurozone. US GDP, jobs and personal consumption data come out, any or all of which could impact crypto markets.