JasmyCoin ($JASMY) is the native cryptocurrency that powers all of the activities within the Jasmy ecosystem. The project aims to create a world in which users own their data while maintaining privacy and security. Panasonic, the renowned tech giant, recently collaborated with Jasmy (JASMY) blockchain to launch a groundbreaking Web3 platform that will enable the seamless connection of personal data on the Internet of Things (IoT).
Uniswap ($UNI) is the governance token for the decentralized exchange Uniswap. The DEX recently announced that it is raising its trading fees. The majority of swap fees will increase, from 0.15% to 0.25%. This change is in response to potential legal issues raised by the US Securities and Exchange Commission (SEC). The increase aims to provide long-term funding for ongoing activities and potential legal costs.
PAX Gold ($PAXG) is Paxos' commodity-backed gold stablecoin, which has physical gold backing. When geopolitical tensions in the Middle East escalated over the weekend, investors rushed to purchase the PAXG token for gold exposure. Although the crypto market fell due to the risk backdrop, PAXG reached a new all-time high of $3,295 on the exchange. This was due to strong demand for the risk-haven asset in the crypto market after traditional markets closed.
Overall Market
The above chart shows the BTC price movement in the last 30 days.
As we discussed in our previous post, our desk believes the $60k - $61k range is a strong demand zone (the red box). When the BTC price breaks the upward trendline support at $66.5k, the next strong support will be the strong demand zone between $60k and $61k.
On April 13 and 14, BTC fell 14.5% in 48 hours, from $71k to $60.6k, due to bearish market sentiments caused by the revision in rate cut estimates by the Federal Reserve and geopolitical tensions.
The first wick down from $70k to $65k was more closely related to hawkish Federal Reserve members' comments on this year's rate cuts. Following the hotter-than-expected CPI numbers, the financial market revised its previous expectation of a 25 basis point rate cut by the Fed in June. As supporting evidence, US Treasury yields rose. The revision of estimates of three rate cuts to two by the Federal Reserve this year dampened some bullish sentiment in risky assets, as monetary easing from the Fed may not occur as soon as the market expected.
Iran's use of drones and missiles to attack Israel on Saturday heightened Middle Eastern geopolitical tensions. With the risk backdrop, our desk witnessed a massive sell-off in the cryptocurrency market, which was the only market open for trading over the weekend. BTC fell nearly 10% in two hours, dragging down the entire crypto market, with many altcoins falling by 30%-50%. The rapid sell-off resulted in a large number of liquidations, enhancing the scale of the sell-off.
While BTC price dropped towards the strong demand zone ($60k - 61k), it quickly rebounded and traded back above $65k within three hours.
However, as Middle East tensions between Israel and Iran persisted, bearish sentiment and risk-averse trading behaviour continued to dominate the market. Our desk believes the market will attempt to test the strong demand zone in the coming days.
If the Bitcoin price breaks the $60k - 61k range, the next support level will be $59k, which BTC had tested when its price reached the previous all-time high of $69k in March.
If the $59k support level fails, the $56k–$57k range will be the next support level.
Options Market
The above table shows the 25-delta skewness for BTC and ETH options.
Following the weekend sell-off, our desk noticed that the options market was indicating strong bearish sentiment in the shorter term. The 25-delta skew on BTC options with a 7-day expiry was -6.39, while the data for ETH options with the same expiry was -10.7.
The heavily skewed negative data suggests that due to Middle Eastern tensions, options traders and institutional investors were more risk-averse on BTC and ETH over the next 30 days.
On the other hand, at the 60-day expiry, the skew of BTC options is positive. At longer time frames, the data remains above zero. Following the halving, options traders and institutional investors remain bullish on BTC in the long run, with a preference for puts to protect against short-term downside.
However, our desk noticed that options traders are bearish on Ethereum with a longer tenor. As shown above, the 25-delta skews on ETH are negative in the short, intermediate, and long tenors, turning positive only with a 180-day expiry. Without a catalyst in the near future, we expect ETH to underperform BTC over the next three to six months.
With the halving this Friday, our desk anticipates increased implied volatility and higher short-term option premiums. It is critical to manage the risks associated with this much-anticipated event.
Macro at a glance
Last Wednesday (24-04-10)
In March, the US CPI rose by 0.4% month on month, exceeding the expected 0.3%. The annualised CPI growth rate was 3.5%, versus an estimated 3.4% and 3.2% last month. Core CPI came in higher than expected as well at 0.4% in March, with an annualised rate of 3.8%, both the same as February's figures. After the CPI data print, the market began to reduce the likelihood of a June rate cut.
The Bank of Canada kept its interest rate at 5.00% and hinted at a first rate cut in June if inflation continued to decline.
Last Thursday (24-04-11)
The European Central Bank maintained its interest rate at 4.50% and indicated that it would consider its first rate cut in June. As the European zone's inflation rate has fallen from 10.6% in 2022 to 2.4% in March 2024, the ECB has a stronger foundation to ease monetary policy. Arguably, Eurozone economic conditions allow the ECB to make one rate cut on its own rather than following the Federal Reserve's lead in cutting interest rates.
Last week, US initial jobless claims were at 211k, lower than the estimated 216k and the previous week's 222k.
In March, US PPI increased by 0.2% month on month, falling short of the expected 0.3% and February's 0.6%. In March, core PPI rose by 0.2% month on month, as expected. The lower PPI data suggests that US inflation may continue to fall, while the higher-than-expected CPI data in March may only be acting as a speed bump.
Last Saturday (24-04-13)
Iran launched an attack on Israel with more than 300 drones and missiles. The escalated geopolitical conflict caused the crypto market to fall as a whole, with gold-related cryptocurrencies being the only asset to rise.
On Monday (24-04-15)
In March, US retail sales increased by 0.7% month on month, beating the estimated 0.4% growth rate but falling short of February's 0.9% increase. The core retail sales growth rate was 1.1%, higher than the estimated 0.5% and February's 0.6%.
Convert Portal Volume Change
The above table shows the volume change on our Convert Portal by zone.
This week, our desk noticed that trading volume increased significantly in Launchpad.
Over the last seven days, the Launchpad Zone has experienced an 81.9 percent increase in volume. TROY ($TROY) and Open Campus ($EDU) are the main contributors to such growth.
The Storage zone saw an 8.2% increase in trading volume on Convert. Bluzelle ($BLZ) and Arweave ($AR) saw the highest increase in trading demand among all tokens in the Storage zone.
The NFT zone, however, experienced a 41.7% volume drop during the same period. Tensor ($TNSR) and ApeCoin ($APE) had the most significant volume drop in this zone.
Why trade OTC?
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