Recurring market commentary on what’s happening in the crypto markets, summarized by the Crypto Broker team at Crypto Finance AG.
Market commentary
Good Morning!
Bitcoin remained at about the same level this week as last week (-0.3% in 7 days) and is now trading just slightly below USD 23,000. Meanwhile ETH is trading at USD 1.53k and therefore the ETH/BTC spread is 0.06876 (-3.11% in 7 days).
Week over week, digital assets are consolidating at pre-FTX levels, with BTC once again in the lead and ETH underperforming.
- BTCUSD: 22,933 (-0.21% WoW)
- ETHUSD: 1,577 (-3.26% WoW)
- SOLUSD: 24 (-1.48% WoW)
- Crypto Total Market Cap: USD 9,97B (-0.55% WoW)
Events in relation to the macro and TradFi side
- Wednesday, Feb 1: FOMC (exp 25 bps hike towards 450-475 bps target rate)
- Thursday, Feb 2: US jobless claims
- Friday, Feb 3: US NFP
Among others, $AAPL, $GOOG, $AMZN, and $META will be reporting their earnings this week. I plan to take a close look at these reports. As was the case for digital assets, these companies too had a tough 2022, and excluding Apple, they all had substantial lay-offs. As rates increased, investors looked for profitable companies with free cash flow, which resulted in the crypto and tech dump. In these reports, we should be able to ascertain the healthiness of their business.
On the crypto derivatives side
Futures keep being relatively stable with the 3-months basis on Binance trading at a 5% premium on BTC and at a 4.6% premium on ETH. This keeps being bearish for ETH/BTC. The BTC and ETH ATM Volatility term-structure is back to flat, trading around the bottom 25% of historical observations (avg atm iv for all expiries: BTC: 53v, ETH: 63v), with the FOMC expiry particularly bid (as always). Indeed, VRP for both BTC and ETH keeps being in the top 25% until 60-day to expirations. Volatility buyers are expecting some more moves. Indeed, I am a better seller of volatility in the short term.
The 25-delta skew (put minus call) are trading slightly above the par and around the historical median values for both BTC and ETH. This shows that momentum is fading away. Overall, gamma exposure (GEX index) keeps being relatively high, thus compressing the overall volatility, both for BTC and ETH.
BTC is consolidating above 22.5k which is the closest support. Resistance is at $25k. RSI is downtrading towards 60s, extending the consolidation phase. At the moment, 30-day beta with NDX is exactly 1: BTC is mimicking NDX performance; that’s it. ETH was once again unable to break above USD 1,660, which remains the resistance. Support is USD 1,500. RSI has returned to neutral territory.
Happy Trading!
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