Research Summary
- BTC is attempting to breach the 30k resistance level again, despite previous challenges.
- Ethereum is showing signs of recovery, especially after recent issues related to DeFi and the Curve exploit.
- The launch of Paypal’s new stablecoin on the Ethereum main net (PYUSD) might be influencing the current rally.
- Decreasing trading volumes in the crypto market could hinder the sustainable growth of asset values.
- Key events to monitor include Bitcoin ETF decisions, legal issues involving Coinbase, international regulatory developments, and shifts in monetary policy in H2 2023.
- The July payroll report indicated an increase of 187,000 jobs, which was below the expected 200,000.
- Upcoming US Consumer Price Index (CPI) and Producer Price Index (PPI) data will be crucial in understanding market trends.
- There’s a noticeable divergence between traditional finance and cryptocurrency volatility.
- Long-term volatility for both BTC and ETH is at historic lows, indicating potential market shifts.
- There’s a significant volatility spread between ETH and BTC, suggesting BTC might lead bullish activity in the next 6-9 months.
- BTC’s skew indicates a preference for calls, while ETH’s skew leans towards puts.
- Trading volumes in BTC options have increased, mainly due to the buying of long-dated calls.
- ETH option volumes have risen by about 30%, primarily driven by a resurgence in call selling.
Actionable Insights
- Monitor Key Events: Keep an eye on Bitcoin ETF decisions, Coinbase legal issues, and international regulatory developments.
- Watch for CPI and PPI Data: The upcoming US CPI and PPI data will provide insights into market trends and potential shifts.
- Consider Long-Term Volatility: With BTC and ETH’s long-term volatility at historic lows, there may be opportunities for strategic investments.
- Assess BTC and ETH Skew: The skew differences between BTC and ETH can provide insights into market confidence and potential investment strategies.
- Review Option Volumes: Increased trading volumes in BTC and ETH options suggest market activity and potential investment opportunities.
- Strategy Recommendation: Consider owning short-dated BTC calls for potential upside on CPI this week. Long-term value may be found in Dec23-Jun24 ETH calls.
