LMAX Digital volumes have been solid all week. Total notional volume for Wednesday came in at $486 million, 45% above 30-day average volume.

Bitcoin volume printed $267 million, 48% above 30-day average volume. Ether volume came in at $110 million, 40% above 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $8,035 and average position size for ether at $1,964.

Volatility is finally trending higher after weeks of decline. We’re looking at average daily ranges in bitcoin and ether of $3,553 and $175 respectively.

Price action across crypto has been undeniably heavy over the past 24 hours, with bitcoin acting as the primary drag on broader sentiment and ETH following suit.

That said, many of the hallmarks of capitulation are now in place: daily technicals are deeply oversold, the fear and greed index has slipped to extreme lows, and bitcoin is now roughly 45% below its October peak.

While the drawdown has been painful, this type of retracement is far from unfamiliar in crypto cycles, and importantly, it comes against a backdrop of still-constructive longer-term fundamentals.

We see the selloff as the result of several overlapping forces. Expectations had become stretched around the idea that bitcoin would not revisit sub-$100k levels, and when Q4 failed to deliver the upside momentum many had priced in, positioning quickly unwound.

Adding to the discomfort is the fact that this pullback is unfolding at a time when structural progress and mainstream adoption arguably look stronger than ever—making the correction psychologically harder for participants to absorb.

Compounding matters, crypto has struggled to attract incremental inflows despite equities pushing to fresh highs and metals continuing to surge, leaving digital assets looking isolated in the broader risk landscape.

From a technical perspective, bitcoin’s move toward the $70k area brings a key level into focus near $69k, which aligns with the 2021 cycle high and represents major prior resistance turned potential support.

While we cannot rule out additional near-term volatility, the combination of oversold signals, washed-out sentiment, and proximity to longer-term support argues that the market is moving closer to a meaningful base rather than further away from one.

Beyond crypto-specific dynamics, traditional markets remain an important swing factor. Yen weakness tied to Japan’s election outlook, easing eurozone inflation, and ongoing uncertainty around U.S. growth and labor momentum continue to shape global risk appetite.

The dollar has stayed modestly supported, yields remain firm, and geopolitical headlines—from Middle East tensions to shifting fiscal expectations—are keeping investors selective, all of which has limited crypto’s ability to participate in broader risk rallies.

Looking ahead, we expect near-term trading to remain headline- and macro-sensitive, but view current levels as increasingly attractive for medium-term positioning, particularly if global liquidity conditions stabilize and risk sentiment improves.

For now, bitcoin remains the key proxy for direction, with ETH and the broader complex likely to follow its lead, and while volatility may persist, the balance of evidence suggests we are approaching conditions consistent with a cyclical low rather than the start of a prolonged bear phase.