Weekend Brief

This week was a relatively volatile one for the crypto market. BTC retested the local top of 69,500 last seen in July but failed to break through. It eventually retraced its gains, finding support at the 65,000 mark and now appears be forming a consolidation pattern.

BTC ETF net inflows for the week amounted to $997.7 million, marking the 3rd consecutive week of positive flows, signaling robust institutional demand.

Bitcoin dominance continues to rise, reaching highs of 59.75% for the week. On the contrary, ETHBTC broke its key support at 0.03850, sliding 5.85% to a new low at 0.03625. We believe that the uptrend in bitcoin dominance is likely to persist in the near term as bitcoin approaches its ATH levels.

Reports of alleged US government investigation into Tether caused a sharp decline in the price of the USDT stablecoin. USDT tumbled to a low of 0.9965 before recovering above 0.9980s for the week. Tether CEO Paolo Ardoino has thus far denied these claims and it remains to be seen if the allegations are substantiated as this has not been the first time Tether has gotten under such scrutiny.

In the Middle East, tensions continue to intensify as Israel launched retaliatory strikes on Iran for the missile barrage earlier this month.

The Israeli retaliatory strikes alongside the USDT fiasco on Friday created some selling pressure in the markets, with the DJIA and SP 500 both down 0.61% and 0.03% respectively. Crypto fell shortly after, with BTC briefly dipping to 65.5k at one point.

As the week draws to a close, the focus now is on the upcoming non-farm payroll data next Friday which will provide further insights into the Fed’s next course of action. The current odds of a 25 bps Nov rate cut now sits at a comfy 95.1%, with the market anticipating little surprise.

Trade Idea

We still favor the accumulator to load up on discounted BTC before its eventual breakout from ATH levels.

BTC ACCUMULATOR

• Spot Ref: 67,000 BTCUSD
• Maturity: 27DEC24
• Strike: 64,000
• Upper Barrier: 74,000
• Observation Frequency: Weekly