LMAX Digital volumes cooled off on Tuesday, with the market not wanting to do too much ahead of today’s FOMC decision. Total notional volume for Tuesday came in at $249 million, 29% below 30-day average volume.

Bitcoin volume printed $123 million on Tuesday, 36% below 30-day average volume. Ether volume came in at $101 million, 19% below 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $6,563 and average position size for ether at 2,799.

Volatility has been absent from the market for much of 2022 and is still trending down near yearly and multi-month lows. We’re looking at average daily ranges in bitcoin and ether of $583 and $71 respectively. But there are signs of a volatility surge on the horizon following this intense period of range contraction.

The market is very much fixated on the outcome of today’s Fed policy decision, which could set the tone for the direction prices take over the coming days and weeks.

It’s worth noting, historically, the month of November has been a strong month for crypto assets. This follows an October month that had been projecting upside on its own track record of strong performance over the years.

Given the current fundamentals and driving forces in markets, for crypto to want to trade higher, it would likely need to translate to signs of inflation cooling off in the US, or a communication from the Fed that turns a little less hawkish than what we’ve been hearing.

Technically speaking, crypto assets have held up well in recent weeks, despite ongoing fallout in traditional assets, and there is now the possibility of a meaningful bottom, with bitcoin showing early stages of a double bottom formation.

But for this bottom formation to be confirmed, we would need to see bitcoin break back above $25,200. Until then, the trend continues to point south, and risk remains for deeper setbacks in 2022.