LMAX Digital volumes held steady on Tuesday. Total notional volume for Tuesday came in at $419 million, matching 30-day average volume.

Bitcoin volume printed $247 million on Tuesday, 3% above 30-day average volume. Ether volume printed $128 million, 13% above 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $7,726 and average position size for ether at 2,961.

Volatility has been trending lower in correction mode after peaking out at a yearly high in March. We’re looking at average daily ranges in bitcoin and ether of $938 and $75 respectively.

In recent days, we had seen some weakness in cryptocurrencies. We attributed the weakness to a combination of factors including an overdue technical correction, regulatory uncertainty, and yield differentials moving back in favor of the US Dollar.

But on Tuesday, all of that weakness was quickly swallowed up, with both bitcoin and ether racing back to the topside. We had said the outlook remained constructive despite the weakness we had been seeing, and as of now, this has indeed proven to be true.

What’s even more encouraging is seeing the rebound we saw on Tuesday in light of broader market price action. On Tuesday, US equities came under a good amount of pressure and closed well down on the day, all while crypto traded higher.

This is not what many would expect and this has left a good deal of market participants scratching their hands, trying to reconcile the glaring disconnect. But we believe this is all a part of the same story that has been so supportive of crypto assets in 2023.

Remember, recent woes in the traditional banking sector have shed a positive light on the narrative around cryptocurrency and the advantages of taking on exposure to a decentralized, limited supply asset that can be self custodied.

And so, when on Tuesday, those banking woes came back to the fore, it wasn’t at all surprising to see crypto benefitting from the flow.

Just to review, First Republic revealed a larger than expected deposit drain, while UBS and Santander shared their own negative headlines around earnings misses and deposit outflows respectively.

Looking ahead, we believe it will be important to keep an eye on the highlighted technical levels in today’s report. While bitcoin holds above $26,525, the focus remains on the topside for a retest and break of the yearly high up at $31,050.