Another volatile week for crypto as we had the FOMC meeting earlier this week, increasing rates by a quarter point inline with expectations.
From last week BTC attempted to break back above $30k, however failed to hold as selling volume stepped in driving price back towards $27k.
Altcoin performance this week has been skewed as selling and buying volume was mixed across the board.
TRX is currently up 6.4% over the past 7 days, as buying volume stepped in and lifted price. Tron DAO made their presence known at the recent Consensus event, making a series of announcements instilling confidence in investors, driving price higher.
INJ was amongst the bottom performers this week currently down 8.4%, despite the strong performance throughout the start of this year, INJ is still subject to pullbacks. If BTC can show signs of strength, breaking back above $30k, we are likely to see a further bounceback.
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Convert Portal Volume Breakdown
Crypto to stablecoin transactions remain significant, topping the list with a value of 32.22%. With the market experiencing large fluctuations in both directions, participants still look to sideline cash waiting for the next opportunity.
2nd on the list was stablecoin to crypto with a value of 23.70%, as always participants look to average into positions as the market fluctuates with a longer term scope in mind, focusing on a ‘hodl’ perspective.
Stablecoin swaps picked up traction this week with a value of 13.14% after seeing a period of substantially low volume. It remains unclear what has caused the demand to pick back up.
Options
We see that BTC and ETH option ATM implied volatility difference is narrowing down. After the FOMC meeting this Wednesday, our desk observed that capital rotated from risk assets to safe-haven assets like Gold, pushing Gold price to a 3-year high, this also happened to BTC. After the US market closed, BTC soared over 3% and traded back above $29k. With a narrower ETH - BTC IV difference right now, a long ETH Vol / short BTC Vol in 180-day expiry play could be profitable if the difference is going to widen back to the normal range in future.
Overall market technicals
BTC
Not much has changed on the BTC chart, as price returned back within the previous range we had outlined.
The past 2 weeks have been quite choppy for BTC, as price attempted to break above $30k (midrange) however sharply declined at the start of the week.
A potential trendline support has formed, which could be a target if BTC fails to hold the current range.
The bulls will need a strong break above $30k in order to keep momentum pushing to the upside and keep the altcoin market above water.
INJ
INJ has taken a bit of a step back this week after seeing a period of solid performance.
Recently it broke above the major S/R level and set a near yearly high of $10.
Since then it failed to make a new high and looks to be retesting the new support level.
Bulls will need to see this major level hold for another attempt to break above $10 and set a new yearly high.
Alternatively, if it fails we would likely see a further pullback.
Macro at a glance
Last Thursday (04/27/23), the US GDP reading was 1.1%, lower than the estimated 2%. Meta, the parent company of Facebook, released better-than-expected Q1 earnings Wednesday after market close, leading the risk assets closed in green: S&P 500 was up 1.83%, Nasdaq was up 2.76%, and BTC was up 3.8%, testing the $30k level but failing.
Last Friday (04/28/23), Core PCE Price Index, which the FED closely monitors, reports the month-to-month growth @ 0.3%, as expected.
Tuesday (05/02/23), RBA hiked the rate by 25bps surprisingly, causing AUD/USD to pump over 1% after the announcement. Although it reported weaker-than-expected inflation last week, the board of RBA weighed on other factors: strong labour market and high housing prices.
Wednesday (05/03/23), the Fed raised the interest rate by 25bps to 5.25% as the market anticipated. The FOMC statement signalled a pause in the next meeting. Risk assets sold off after the press, and capital fled to safe-haven assets. Gold price soared past the $2,070 level and touched $2,080, the highest since the pandemic. Capital also flew into crypto space after the US market close. BTC was up over 3% to $29.3k.
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