As prices stabilize after last week’s selloff, it’s been quiet in crypto markets. The returns have been mixed among alternative cryptocurrencies, with Solana’s SOL down 19% due to network failures over the past week, while Avalanche’s AVAX token gained 34%, which was driven by Avalanche’s $230 million latest funding round.
Bitcoin traded at $47,000 as of press time and has risen 6% in the past week. Analysts expect BTC to continue consolidating in the short-term, as long as the larger uptrend is intact.
FundStrat, a global advisory company, said Wednesday that the combination of fundamental metrics, bullish technical indicators, and a soft macro picture allowed us to confirm our view about a bullish run throughout the rest of the year. “We are buyers for BTC and ETH in any near-term buying.”
However, regulation remains a major obstacle to cryptocurrencies. A complaint was filed by a human rights group last week against El Salvador’s Court of Accounts regarding the government’s handling of crypto ATMs and bitcoin purchases. Sebastian Sinclair, CoinDesk’s reporter, reports that protests have been held in the capital against the country’s new bitcoin law.
Bloomberg reported on Thursday that the U.S. Treasury Department was preparing a report about stablecoins, and the potential risks they pose to the financial system.
Bitcoin (BTC), $47,516, +0.1%
Ether (ETH), $3,421, -4.0%
S&P 500: -0.9%
Gold: $1,752, -0.1%
10-year Treasury yield closed at 1.378%
The spot market is similar to the bitcoin futures and options market. However, there have been some warning signs.
QCP Capital, a crypto trading firm, stated in a Telegram chat that they had seen “healthy spot buying demand for BTC and ETH on the desk.” “But, we have also seen decent profit-taking at current levels – mixed signal.”
The positive one-week and month bitcoin put-call Skews indicate a cautious attitude among traders. These skews measure the cost for puts (or bearish bets) relative to calls (which are bullish bets). According to CoinDesk’s Omkar Godbole, the positive values indicate that traders are looking for short-term protection against downside risks.
QCP believes bitcoin will consolidate in the $45,000 to $50,000 range, despite mixed signals from options markets.
QCP wrote, “At these levels have turned slightly short spot also in BTC/ETH against our long spots positions in the altcoins.”
Coinbase trading volumes decline
Although trading volume on Coinbase has decreased slightly in the last week, it remains high compared to recent months. This is due to the recent price consolidation in large cryptocurrencies, like bitcoin and ether. However, traders are more interested in smaller alternatives to cryptocurrencies.
Coinbase sent a Friday newsletter to its institutional clients. It noted an increase in volume and predicted a successful fourth quarter. Coinbase stated that BTC volumes have surpassed ETH volumes. While retail interest in ADA is still high, we have seen a significant increase in ALGO volumes over the past week as the L1 (Layer 1] narrative continues.”
Ether pulls back relative to bitcoin
Ether, which is the second-largest cryptocurrency in the world by market capitalization, traded at $3,400 at press time. It has fallen about 3% over 24 hours compared to bitcoin’s flat performance during the same period.
ETH has outperformed BTC in the last week, but the rate of its relative upside is slowing. The ETH/BTC ratio has fallen from 0.08 resistance during the crypto sell-off last week and is now close to initial support at 0.07.