LMAX Digital volume continues to look healthy this week, with another solid performance on Tuesday. Total notional volume for Tuesday came in at $720 million, 8% above 30-day average volume.

Bitcoin volume printed $421 million on Tuesday, just 2% below 30-day average volume. Ether volume came in at $222 million, 32% above 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $12,483 and average position size for ether at 5,063.

Volatility has been trending lower in 2022. We’re now looking at average daily ranges in bitcoin and ether of $1,773 and $148 respectively.

Technically speaking, the latest upside breaks in both bitcoin and ether beyond their respective February highs, have now strengthened the prospect for a meaningful bottom. The next key level of resistance for bitcoin comes in the form of the high from late December at $52,100. For ether, that next key resistance comes in at $3,900.

We are however concerned about expectations that this is the start to the next big run to the topside for fresh record highs. While we may see additional upside towards the next mentioned resistance levels, we also struggle to see crypto gaining much more momentum just yet.

Our core concern is that crypto is still correlating to a degree with global risk sentiment. This latest run higher in stocks has definitely served as an additional prop and we still feel there is risk for another big downturn in stocks in 2022 that could open renewed short-term weakness in crypto.

If stocks had already fallen significantly, we would feel more optimistic about the prospect for that next big run higher. But at this stage, we continue to see the balance of risk tilting in favor of another big run of weakness in US equities, which should invite another pullback in crypto.

Of course, looking out medium and longer-term, we fully expect crypto assets to be well supported into dips on the longer-term value proposition. Short-term, we’re just not convinced we’re out of the woods just yet.