$BTC hits monthly lows as global market sells off

​​$BTC 24 Hour High $39,322 / Low $37,564   |   $BTC -2.8% Past 24 hours; -4.1% Past 7 days

Good morning. The crypto market is holding its breath as a provision to limit the extensive use of Proof-of-Work consensus mechanism in digital assets is returned to the latest draft of EU crypto regulation. It’s due for the EU Parliament later today, putting downside pressure on the whole market. Even if it’s written in a softer tone, it will likely result in significant market volatility in the short term along with a potential rate hike and Ukraine’s geopolitical turmoil. 

$BTC pulled back from $39,000 overnight and is now trading at $38,200. It is finding support at the 0.618 Fibonacci retracement level at $38,000 while having range-bound action between the $44,000 and $34,000 levels. With a neutral RSI level, volatility is declining as well. The daily trading volume dropped across all major exchanges to $32 billion – a similar trading level during the market sell-off at $30,000 in July 2021. Until we see clearer market indicators to confirm a decisive move in either direction, price action will likely remain dormant for an extended period as investors sit on the sidelines. 

Bitcoin’s dominance remains the only chart that’s really showing any strength, pushing higher into the mid-40s. As Bitcoin Mining Difficulty reaches an ATH, it is inferred that the bull market actually isn’t over yet. Another indicator is that there has been a massive BTC accumulation over the last two months, suggesting that more miners preferred holding than selling their BTC generally.

Over the past weekend, $ETH saw range-bound actions between the $3,300 and $2.300 levels. With a neutral RSI at 45, the No. 2 digital asset is now trading at $2,600 (0.5 Fibonacci retracement level). We are keen to see $ETH hold support at $2,400, $2,290 and $2,170. Otherwise, based on the current downwards trajectory since early November, $ETH is likely to slide towards the $1,000 levels as early as April. Major macro catalysts are much needed for the bulls to reverse the downtrend. ETH 2.0, signifying the end of Proof of Work mining, could be a possible bullish catalyst.

UAE-based crypto firms are inundated with requests from Russian entities to liquidate their $BTC holdings to invest in tangible assets such as real estate. Dubai, which has long been popular with Russian real estate investors even before the war started, is now on the receiving end of an influx of crypto wealth, trying to evade sanctions from the West. UAE has always been relatively loose in terms of regulatory policies regarding crypto trading and transfers and suits Russians hedging bets against a devaluing rouble by buying up digital assets.

Learn more from today’s Trader View video

Digital Assets Market

  • Total crypto market capitalization stands at $1.77T, -2.9% from yesterday
  • $BTC is +0.1% at time of writing; 24H liquidations and funding rates: 49.32M, -0.00615% average
  • $ETH is +0.0% at time of writing; 24H liquidations and funding rates: 15.38M, -0.00145% average
  • Stablecoins market dominance: USDT 43.29%; USDC 28.31%; BUSD 9.73%; UST 7.93%; DAI 5.08%

Alts and DeFi watch:

  • DeFi TVL: $195.92B (-0.74% over last 24h)
  • $SOL -3.2% in the last 24 hours, -6.9% in the past week
  • $SHIB -2.7% in the last 24 hours, -9.0% in the past week
  • $SAND -2.2% in the last 24 hours, -5.1% in the past week
  • $ENJ -2.6% in the last 24 hours, -3.7% in the past week

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OSL Trader View is contributed by Terrance Leung. Andrea Au & Ethan Fu.

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