8 Apr, 24

Weekly Crypto Market Wrap, 8th April 2024



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This is not financial advice. As always, do your own research.

Week in review



The biggest risk to a more sustained downside move last week was the US employment figures (NFPs) that were following on from the gnarly ISM inflation data. Risks were centred around stagflation indicators. Instead, data saw wage inflation at bay, with better-than-expected employment figures. Perhaps we are beginning to see data normalise despite ‘high’ interest rates? Time will tell but for now, the robust data has led to a BTC bounce at the 65,000 level despite the Fed reiterating probabilities of only two rate cuts this year (down from three expected last month).

Technically, we did expect a break lower from 65,000 – at least to take out some stops – but notable real money buyers are sitting at these levels to pick up the slack. The BTC ETF flows have turned positive again this week, which positions spot BTC to be supported in the short term.

Key event risk this week is centred around US CPI numbers (MoM) and the FOMC minutes. It looks like the market is looking for an excuse to bid anything dovish could light the fire to get us above all-time highs again, if we don’t get there before the data.

Key levels

65,000 / 70,000 / 73,130 (ATH!)

Spot desk 

Crypto/fiat flow balances

Surprisingly, we’ve seen heavier than usual off-ramp activity after the easter break even though AUD has strengthened throughout the week In the majors. We’re seeing decent buy-the-dip activity on desk, in line with the action on BTC and ETH prices this week. 

SOL frenzy – Follow up

Following the Solana mania from the previous week, the frenzy seems to have somewhat tapered down, with meme coins like SLERF, WIF and BONK being hit heavily over the week. Interestingly, we’ve yet to see clients taking profits on their tokens. Perhaps these tokens are truly becoming a collectors’ item, or maybe it’s a “hold on for dear life” manoeuvre. 

Bitcoin Halving 

With the Bitcoin halving just 12 days away, we are expecting a pickup in volatility over the coming weeks. Combine this with 2-weeks of consolidation and Open Interest in derivatives rising, we could see some action both ways.

Derivatives desk

We’ve seen realised volatility drop off significantly since the highs of March, while implied volatility has sustained its levels. As seen below, 15-day implied volatility is trading roughly 27 vol points above 15-day realised volatility. One could trade this negative carry by selling ATM options to harvest the implied premium, and delta-hedging your spot exposure. This is a more complex trade for those without options experience – hit the team up if you’d like it packaged into a Structured Product.

Contact the derivatives team at [email protected] for more information.

What to Watch

  • USD CPI, FOMC meeting minutes and Bank of Canada’s monetary policy report, on Wednesday.
  • ECB press conference and EU’s monetary policy statement, on Thursday.
  • UK’s month-on-month GDP, on Friday.

* Index used:

  Bitcoin    EthereumGoldEquities        High Yield Corporate Bonds      CommoditiesTreasury Yields
BTCETHPAXG        S&P 500, ASX 200, VT      HYG  SPGSCIU.S. 10Y

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