Band-aid ripped off: Capitulation in full swing

​​$BTC 24 Hour High $30,113  / Low $25,429 |   $BTC -0.9% Past 24 hours; -19.1% Past 7 day

Good morning. The crypto markets are moving lower aggressively again due to yesterday’s market fears about whether the USDT stablecoin would follow the Luna/UST saga suit. USDT was dropped as low as 0.94 to a dollar at one point but has largely recovered for now after its CTO confirmed the majority of its reserves are in U.S. treasuries. As the initial reaction to Luna’s saga, USDT’s de-pegging and U.S. CPI figures started to subside, the overall digital assets markets seem to have stabilized from the shockwave. 

While we didn’t expect it to happen so soon, $BTC nevertheless dropped to test the 50M EMA at $25,700 in the past 24 hours. It’s worth noting the tell-tale signs of capitulation are also visible in Bitcoin’s dominance, which is starting to move higher, currently above 44%. We expect $BTC to range sideways between the $26,000-$29,000 levels for the next few weeks. In times like this, it’s important to take a step back and look at the broader picture – BTC’s adoption increases at an exponential rate if we look at the undeterred growth in wallet addresses with coins. This price action is all part of the crypto cycle, but the mid-to-long term viewpoint remains unaltered. 

$ETH also dipped aggressively amid the crypto market crash, hitting $1,800 at one point. It’s now trading at $2,014 and found support at our first target of $1,718, the July lows of last year. While RSI is still in the oversold region now, we will see some sideways action as we go into the weekend. 

Liquidations across the crypto industry over the last 24 hours were at $750 million, bringing the total amount to a whopping $3.5 billion in the past four days. Interestingly, a good portion of the liquidations was due to short liquidations, with euphoric bears entering late getting wiped out. Crypto’s high correlation to the Tradfi markets persists. The U.S. 10-Year Bond Yield is also about to close its first real week in the red since mid-March. Whether this is the first sign of a trend reversal remains to be seen, so keeping an eye on how stocks perform is the key at this stage.

Despite the crypto downtrend, Shanghai’s High People’s Court decreed that BTC has a ‘certain economic value’ and is a digital asset protected by China’s laws. This is a principal reference point for BTC-related civil disputes within Shanghai among the country’s longstanding crypto opposition.

Besides, OSL SaaS received the “Cryptocurrency – Financial Technology” award in the SBR Technology Excellence Awards. We are pleased to be recognized as a go-to-market solution for firms wishing to offer their own digital asset trading services.

Learn more from today’s Trader View video.

Digital Assets Market

  • Total crypto market capitalization stands at $1.31T, -2.4% from yesterday
  • $BTC is +1.92% at time of writing; 24H liquidations and funding rates: 284.65M, -0.01108% average
  • $ETH is +3.59% at time of writing; 24H liquidations and funding rates: 206.52M, +0.02098% average 
  • Stablecoins market dominance: USDT 48.59%; USDC 30.43%; UST 1.92%; BUSD 10.52%; DAI 3.68%

Alts and DeFi watch:

  • DeFi TVL: $111.29B (-1.74% over last 24 hours)
  • $SOL -10.0% in the last 24 hours, -44.5% in the past week
  • $SHIB -5.7% in the last 24 hours, -41.1% in the past week
  • $SAND -12.1% in the last 24 hours, -44.0% in the past week
  • $ENJ -5.9% in the last 24 hours, -42.3% in the past week

More news that caught our eye:

OSL Trader View is contributed by Hans-Stefan Vonhaenisch, Tiffany Wee & Ethan Fu.

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