Weekly Crypto Market Update - July 17, 2023

LAST WEEK’S RECAP:

• U.S. CPI increased by 0.2% in June vs. 0.3% expected, and 3% YoY vs. 3.1% expected.
• U.S. PPI rose 0.1% in June v.s. 0.2% expected.
• U.S. Federal judge ruled that “programmatic sales of XRP do not qualify as securities, but institutional sales of XRP do qualify the coin as a security”.
• The U.S. government moved another $300M Silk Road-related BTC.
• EigenLayer increased the total cap to 30,000 tokens and later on 45,000 tokens for LST deposits, both reached quickly after the announcement.
• Polygon proposed to upgrade MATIC tokens to become POL.
• Consensys Linear launched the Alpha version.
• Synthetix launched Infinex, a decentralized perp trading platform.

LEGACY MARKETS – DXY

With DXY breaking under the 100 level, the market saw a sharp dive last week. A ton of lower-cap tech stocks started running stuff like HOOD, Unity, and RBLX .. However disappointing it is, with all the favorable news around XRP, BTC still failed to break out. For now, we think DXY will likely range between 98-101 as it re-enters an old 7-year range.

LEGACY MARKETS – VIX

VIX is still weak. However, with earnings season slowly starting this week, and equities being fairly stretched at this point - there’s a good chance we get some more activity/strength in the VIX.

BTC WEEKLY VIEW

BTC last week was a bit of a letdown. After the XRP news, the market saw a large pop in altcoins, but BTC failed to break out of the range it has been in for 4 weeks. With all the confluences of Blackrock/XRP/Favorable crypto news in general there seems to be something over-hanging BTC, that the market is waiting for. However, with the XRP ruling coming out favorable, the market is seeing strong actions against altcoins which have likely entered a "buy-the-dip" environment again when/if BTC retests lower levels.

ETH WEEKLY VIEW

ETH regained some relative strength with the rest of the altcoin market last week. However, there is still no clearance of the 2-2.1k area which is key for further upside.

ETH/BTC

ETH/BTC ratio again bounced off the lower end of the range. Which also reflects in the ETH/USD price performance last week. However, it’s still not “strong” and we’re looking for this to show real strength at least, to get above mid-range again.

TOTAL3 – USD MARKET STRENGTH

TOTAL3 also had a nice recovery after the XRP news. If it can get above the red zone, altcoins will likely start massively outperforming. Below the red zone, it’s best to stick to only the strongest altcoins.

TOTAL3/BTC – BTC MARKET STRENGTH

TOTAL3/BTC is also retesting a huge level together with the confluence of the TOTAL3 index on USD value both are at larger resistance. If they can flip it, it opens the window for altcoins and mid/small-caps and NFTs, to see larger outperformance. However, with the earnings season in equities starting, this might get some delay.

SUMMARY

• XRP news was favorable for the altcoin market. However, BTC is still stuck. This is likely a "buy-the-dip" environment and not a “buy-the-breakout”. With earnings on the horizon, this can cause whipsaw price action. Although crypto is strong, all these short-term whipsaws should be opportunities to add to longer-term spot exposure.
• CPI had its lowest print in over a year. However, the market doesn’t seem to follow a single print, as it follows the trend. And with energy showing signs of life, it could be that the market, for now, has reached a low point in inflation with a short-term trend change from here on out. This could steer the FED in the direction of the “Stop and go” policy as seen in the 70s.
  
  

DISCLAIMER:

The information in this report is for information purposes only and is not to be construed as investment or financial advice. All information contained herein is not a solicitation or recommendation to buy or sell any digital assets or other financial products

This post is prepared by Kairon Labs Traders: Joshua van de Kerckhove, and Patrick Li

Edited by: Rizza Carla Ramos