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Traders are rotating into bitcoin ahead of the merge
September started with bitcoin significantly underperforming the rest of the crypto market. Bitcoin’s weak performance ended last Friday as the price began soaring. As we approach mid-September, bitcoin is the second-best performer among our indexes, with a 12% gain. The best performer is the Mid Cap index, which saw a solid start to the month.Preview
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The market sentiment is improving, but traders are still cautious
The Fear and Greed Index has managed to climb out from the ‘extreme fear’ area. A significant component of the index calculation is market momentum and volume, and recently we have seen growing spot volumes in a positive market. The index still signals ‘fear’, reminding us that investors still don’t believe the seemingly never-ending bear market to be over.Preview
The bitcoin spot volume surges to yearly highs
The 7-day average bitcoin spot volume has surged to a yearly high of $11.4 billion. Most of this trading activity happened on Binance, which has completely taken over the bitcoin spot market due to its fee removal this summer. Binance’s zero-trading fee policy has made new high-frequency trading strategies profitable and attracted these types of traders to Binance’s bitcoin pairs. The 7-day average spot volume on Binance is currently 87% of bitcoin’s total spot volume.Preview
Bitcoin’s third highest daily return in 2022 leads volatility to grow
Over the past weeks, bitcoin’s volatility has been unusually low as the price stabilized around $20k. This calm period ended last Wednesday as the price dropped to a bottom of $18.6k and suddenly made a massive rebound up to $22.3k over just a few days. Most of these gains came last Friday when the price soared by 10.6%. The high volatility will likely continue over the following days as the merge may significantly increase trading activity.Preview