LMAX Digital volumes cooled off from Tuesday levels but were up overall on Wednesday. Total notional volume for Wednesday came in at $591 million, 22% above 30-day average volume.

Bitcoin volume printed $294 million on Wednesday, 38% above 30-day average volume. Ether volume came in at $121 million, 22% above 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $9,417 and average position size for ether at $1,705.

Market volatility has cooled off considerably since peaking out earlier this month. We’re looking at average daily ranges in bitcoin and ether of $3,666 and $181 respectively.

We’re seeing some attempts at a recovery in crypto assets on this Thursday, though we’re not convinced this is the start to the next leg higher.

Most of this view is grounded in the technical picture, with this week’s breakdown in the price of bitcoin below critical support at $89k opening the door for a bigger correction towards previous range resistance in the $74k area.

When bitcoin broke out back in November, we saw an intense push higher, with the price going parabolic, facing little in the way of any selling pressure along the way.

Markets tend to have a hard time feeling good about gains after such one sided moves, and more often than not will want to retest those breakout levels to feel reassured about overall conviction.

The good news is the outlook is extremely constructive and it just comes down to recognizing and being prepared for a deeper drop into the $70-75k area, which should be a formidable zone for medium and longer-term investors to increase exposure.

As far as the fundamentals go, investors are now waiting for more follow through from the pro-crypto US administration, while contending with stress in the traditional markets around trade tension and a more hawkish Fed policy track.

But given how things have gone, it wouldn’t at all be surprising to see trade tension die down as it becomes clear Trump’s tactics are more negotiation than anything else, and to see the Fed ease up on its policy stance as it once again bends to the will of the market for friendlier monetary policy.