Sign up for the free newsletter

{{message}}

Notifications are blocked by your browser.

Please enable them to receive live relevant coverage from The Market Ear

Market alerts are now enabled

We'll send you relevant markets coverage in real time

Market alerts are now paused

To enable them, simply click on the button

      Bitcoin options for the break out?

      One way to play a possible BTC break out move is to use options. First chart shows implied vs realized volatility. BTC options aren't dirt cheap, but on the other hand, realized volatility has been very low inside the consolidation. That could change quickly...Second chart shows the 1 month skew. Buying call spreads for a break out move is relatively attractive given the above.

      Bitcoin options for the break out?
      Source: Genesisvolatility
      Bitcoin options for the break out?
      Source: Genesisvolatility
      Bitcoin - little brother still leading

      ETH continues pushing higher and the gap vs BTC remains very wide. Second chart shows ETH vs BTC since recent lows in % terms (note the weekend puke is not recorded in the chart). BTC as the catch up trade anyone?

      Bitcoin - little brother still leading
      Source: Refinitiv
      Bitcoin - little brother still leading
      Source: Refinitiv
      Bitcoin - time to get excited?

      BTC is closing in on the big 24k level. BTC has reversed off this level on various occasions during the consolidation that has been in place since mid June. Note the rising trend line and the fact the 50 day moving average is sloping up again. A close above 24k and this could squeeze hard. Next resistance is the 100 day moving average at 25.6k and then (if) the huge negative trend line at 28k.

      Bitcoin - time to get excited?
      Source: Refinitiv
      Bitcoin flowzzzz

      Depressing low volatility, now accompanied with depressingly low flows. A close above the big 24k level could change this. Given the squeeze, the FOMO factor is huge and people could start feeling "pressured" to pick up laggards. BTC is one of those candidates...

      Bitcoin flowzzzz
      Source: JPM
      Ever time for bitcoin?

      Bitcoin continues to trade as one of the most boring global assets. It remains stuck in the consolidation it started in June. 24k remains the short term resistance to watch. Note it has managed putting in higher lows, but if this is to (ever) squeeze, we need to close above 24k soon. The long term negative trend line is currently "way" higher and the 100 day comes in at 26k. Second chart shows the BTC vs NASDAQ gap.

      Ever time for bitcoin?
      Source: Refinitiv
      Ever time for bitcoin?
      Source: Refinitiv
      Can this gap continue to widen?

      The NASDAQ vs BTC gap has become huge. Correlation perfection was great, but as we always said, there will come a time when the trade "blows up". The divergence has become rather extreme since mid July, but on the other hand, BTC isn't tech...

      Can this gap continue to widen?
      Source: Refinitiv
      Recall when bitcoin was tech?

      Exciting BTC days are over...the gap between BTC and tech is at very wide levels.

      Recall when bitcoin was tech?
      Source: Refinitiv
      Bitcoin - trapped

      BTC is supposed to be an exciting asset, but boring is probably describing BTC well these days. The crypto has done nothing since mid June. The boring range remains intact. Both the 100 and the 200 day moving averages are "well" in place. Second chart shows BTC vs NASDAQ. The old "connection" is gone...

      Bitcoin - trapped
      Source: Refinitiv
      Bitcoin - trapped
      Source: Refinitiv
      ETH - time for the next leg?

      ETH reversed right on the negative trend line as well as the 100 day moving average last week. Note the shorter term positive trend line comes in slightly lower. ETH is trapped between these two trend lines and we should be seeing a break out soon...

      ETH - time for the next leg?
      Source: Refinitiv
      Bitcoin trying to tell us something?

      That BTC vs tech gap looking rather huge again...

      Bitcoin trying to tell us something?
      Source: Refinitiv
      Whatever happened to BTC vs tech "love"?

      It used to work so well trading the "pairs". Do you buy BTC as a laggard (24k is the huge resistance to watch) or do you sell tech because BTC is telling us something?

      Whatever happened to BTC vs tech "love"?
      Source: Refinitiv
      ETH - up 100% from the low print in June

      Annualize that...

      ETH - up 100% from the low print in June
      Source: Refinitiv
      BTC - stuff "going on"

      BTC is breaking above the negative trend line that has been in place since late March. 24k is the short term resistance to watch. Note we are above the 50 day as well. A close above that level and things could get rather dynamic. As we wrote early this morning: "One way to play a possible catch up trade is via call spreads as your max loss is known. Vols have come down lately, and despite not being dirt cheap, call spreads aren't overly expensive as skew has picked up"

      BTC - stuff "going on"
      Source: Refinitiv
      Bitcoin - still lagging tech

      NASDAQ is basically back to the pre mid June sell off levels. BTC on the other hand is way lower. The correlation perfection between these two assets is less perfect these days, but imagine BTC starts closing some of the wide gap. One way to play a possible catch up trade is via call spreads as your max loss is known. Vols have come down lately, and despite not being dirt cheap, call spreads aren't overly expensive as skew has picked up. Second chart shows the 1 month implied vs realized vols. Third chart shows the 1 mth 25 delta skew.

      Bitcoin - still lagging tech
      Source: Refinitiv
      Bitcoin - still lagging tech
      Source: Genesisvolatility
      Bitcoin - still lagging tech
      Source: Genesisvolatility
      What if bitcoin "rules?

      Just an update from the charts presented yesterday....

      What if bitcoin "rules?
      Source: Refinitiv
      What if bitcoin "rules?
      Source: Refinitiv
      Bitcoin as the canary?

      If BTC is the aggregate market psychology on steroids, then watch the latest relatively muted reaction vs many assets, NASDAQ included.

      Bitcoin as the canary?
      Source: Refinitiv
      Crypto - who is the leader?

      BTC is the big brother and the relative under performance in early April spilled over to ETH. Will we see a repeat or is this time different?

      Crypto - who is the leader?
      Source: Refinitiv
      Bitcoin - was that it?

      Bitcoin remains trading with poor momentum despite the latest move higher. The longer term negative trend line remains very much in place. BTC has done nothing since June. We are down to the 50 day again, and 100 day is way higher...

      Bitcoin - was that it?
      Source: Refinitiv
      Minecraft thinks NFTs are a minefield

      Minecraft has decided NFTs have no place in its future. Minecraft completely rejecting NFTs and what they represent is a big deal. Minecraft is the most successful video game and virtual world in history, and WAS a big target for NFT racketeering.

      Minecraft thinks NFTs are a minefield
      The "debasement" of the digital stuff

      It wasn't long ago people were buying bitcoin because of the dollar debasement logic. The dollar did the opposite thing and people are left with many positions having gone extremely wrong, "just" because they got the dollar call wrong...Let's see if stuff like BTC catches up to the latest DXY move. Chart shows BTC log vs DXY inverted.

      The "debasement" of the digital stuff
      Source: Refinitiv
      It must be bullish when even BTC is moving higher...

      Laggard vs NASDAQ over the past month, but showing signs of life?

      It must be bullish when even BTC is moving higher...
      Source: Refinitiv
      Bitcoin - mini green shoots?

      Bitcoin has traded extremely boring over the past weeks. Sure, we have had some big down as well as up days, but there is no trend. Note the tiny pick up in inflows...

      Bitcoin - mini green shoots?
      Source: JPM
      The big bitcoin FX flop

      Recall when everybody bought bitcoin due to the dollar debasement argument? The irony is that the bitcoin vs DXY relationship stayed intact, but people got the debasement logic wrong. Bitcoin and the DXY (inverted) continue moving in perfect tandem. So right, but so wrong for most people...

      The big bitcoin FX flop
      Source: Refinitiv