LMAX Digital volumes held up well overall on Tuesday. Total notional volume came in at $295 million, 10% above 30-day average volume.

Bitcoin volume printed $132 million, 9% below 30-day average volume. Ether volume came in at $75 million, 57% above 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $6,931 and average position size for ether at $1,258.

Volatility has turned up substantially off multi-month lows. We’re looking at average daily ranges in bitcoin and ether of $2,419 and $91 respectively.

The crypto market is consolidating following the sharp selloff that drove both Bitcoin and ETH to fresh yearly lows. Price action has been notably subdued over the past several sessions, with investors appearing reluctant to aggressively chase a recovery without a clearer macro catalyst.

Despite increasingly oversold conditions and technical indicators that warn of the potential for a larger rebound ahead, the market remains firmly in wait-and-see mode. Participants are still assessing whether the recent lows marked an important inflection point or merely a pause before another leg lower.

Bitcoin remains the primary barometer for broader crypto sentiment, though price action has been relatively uninspiring following the latest bout of heavy selling. While there has been a notable break in the previously strong correlation between crypto assets and US equities, the early-week softness in stocks may still be limiting the appetite for digital assets to establish a more convincing recovery despite already intense declines.

At the same time, market participants appear reluctant to aggressively rebuild exposure ahead of today’s US inflation report, which has the potential to significantly influence expectations around Federal Reserve policy, the direction of the US Dollar and the broader appetite for risk. For now, Bitcoin is trading more as a market awaiting its next catalyst rather than one displaying a clear directional bias.

Ethereum continues to lag Bitcoin from a relative performance perspective, reflecting a market that remains selective in its risk-taking behavior. That said, ETH has also managed to stabilize following its latest leg lower, suggesting that selling pressure may be beginning to ease.

Any broader improvement in market sentiment would likely encourage a catch-up trade given the magnitude of Ethereum’s recent underperformance. As has often been the case during previous recovery phases, sustained strength in Bitcoin would be expected to eventually filter through into higher-beta areas of the crypto market.

Beyond crypto-specific developments, traditional macro drivers remain firmly in focus. Escalating geopolitical tensions in the Middle East and their impact on oil prices have reinforced concerns around inflation, while stronger recent US economic data have supported the view that the Federal Reserve may be in no rush to ease financial conditions.

A hotter-than-expected CPI print could strengthen the US Dollar and weigh on risk assets broadly, while a softer outcome may offer the catalyst needed to reignite appetite across both equities and crypto. For now, the market appears content to wait for greater clarity before committing to a stronger directional move.

From a technical perspective, the key levels remain well defined. On the downside, the previous weekly and yearly lows near $59,000 in Bitcoin and $1,500 in Ethereum represent important support zones that, if breached, could invite another wave of selling pressure.

More importantly, traders will be watching the upside levels around $64,250 in Bitcoin and $1,725 in Ethereum. A decisive break above these thresholds could signal that a larger recovery phase is underway and open the door for a fresh wave of bullish momentum.