LMAX Digital volumes followed up Tuesday’s healthy performance with another solid showing on Wednesday. Total notional volume for Wednesday came in at $442 million, 11% above 30-day average volume.

Bitcoin volume printed $244 million on Wednesday, 8% above 30-day average volume. Ether volume came in at $154 million, 28% above 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $6,160 and average position size for ether at 2,438.

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 $960 and $96 respectively.

We’ve been impressed with bitcoin performance over the past 30 days. If we look at how bitcoin has stacked up against other traditional assets, it has outperformed the Euro, Yen, Canadian Dollar, gold, Australian Dollar, S&P 500, New Zealand Dollar, and British Pound. Only the classic safe haven US Dollar and Swiss Franc have beat out bitcoin.

We’re not sure we’re there just yet, but we do believe this is where we are headed. We expect bitcoin to emerge as an asset that outperforms in periods of risk off, and just maybe we are starting to get a little glimpse of this in September.

Having said this, it’s still worth noting that bitcoin remains in a well defined downtrend against the US Dollar and remains at risk for deeper setbacks. Wednesday’s relief rally in financial markets helped to prop crypto assets a bit, and it seems as though that relief rally came from an expectation that the Fed may soon capitulate and ease up on monetary policy.

But aside from the BOE move towards a small dose of QE, there have been no such signs the Fed is looking to scale back on its rate hike timeline, and there have been no such signs that inflation is ready to come back down. All of this suggests what we’ve seen over the past 24 hours is nothing more than an overdue technical correction ahead of more downside pressure on risk assets.

For now, this means the possibility for more downside pressure on crypto assets, with scope for fresh yearly lows in both bitcoin and ether. Again, we do believe we are getting closer to a point where we will see bitcoin fully breaking away from correlations with risk sentiment. But we don’t believe we’re there just yet.