LMAX Digital volumes have been trending lower this week and were once again soft on Tuesday. Total notional volume for Tuesday came in at $233 million, 38% below 30-day average volume.

Bitcoin volume printed $127 million on Tuesday, 39% below 30-day average volume. Ether volume came in at $75 million, 34% below 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $6,210 and average position size for ether at 2,624.

Volatility has been absent from the market for much of 2022 and is still trending down at yearly low levels. We’re looking at average daily ranges in bitcoin and ether of $692 and $62 respectively.

Cryptocurrencies continue to mostly track with broader global risk sentiment, which has resulted in a lot of the downside pressure we’ve been seeing in 2022.

Having said that, while stocks are making fresh yearly lows and the US Dollar is extending yearly, multi-month, and multi-year gains against many currencies, bitcoin and ether have held up well above their respective yearly lows. We believe this does show some signs of the market recognizing the longer-term value proposition of crypto assets.

As far as what to pay attention to this week goes, we have a Fed Minutes later today and an important US inflation print tomorrow. A lot of how things play out here will likely dictate direction in markets.

If there are signs of the Fed being less hawkish or US CPI softening, we should expect to see a recovery in risk assets, selling in the US Dollar and demand for crypto assets by extension. If however we get more hawkishness and hot CPI data, look out for more downside pressure in risk assets, upside in the US Dollar, and selling in crypto.