LMAX Digital volumes have been lighter in recent days as the crypto market consolidates. Total notional volume for Wednesday came in at $450 million, 44% below 30-day average volume.

Bitcoin volume printed $318 million on Wednesday, 48% below 30-day average volume. Ether volume came in at $89 million, 27% below 30-day average volume.

Looking at average position size over the past 30 days, we’re seeing average bitcoin position size at $14,986 and average position size for ether at $3,718.

Volatility remains elevated overall, but has cooled in recent sessions off of multi-month highs set earlier in the month. We’re looking at average daily ranges in bitcoin and ether of $1,683 and $108 respectively.

Setbacks in the crypto market have stabilized, at least for a moment. In our technical update, we cite bitcoin bouncing out from an initial area of previous resistance turned support in the $38k area.

While it’s certainly possible the dip has come to an end following the drop towards $38k, we still wouldn’t rule out the possibility for additional corrective price action back towards a more critical level of previous resistance turned support around $32k.

Ultimately however, whether the correction extends or not, the important takeaway is that we are in the throes of a correction, which means the market is searching for the next higher low ahead of a bullish continuation.

We don’t believe there is risk for any meaningful weakness below $30k in 2024. If we do see a drop below the psychological barrier, we expect it will be short-lived, with longer-term players jumping in to take advantage of super discounted prices.

This week, we’ve spent time highlighting the drivers behind the latest pullback including unwinding of GBTC positions, FTX bankruptcy estate selling, broad US Dollar demand, and bitcoin’s break below $40k.

There is another possible driver of weakness that is also worth noting. The other day, Mt. Gox initiated a long awaited phase of its repayment plan, reaching out to old users to verify their accounts.

We’ve been hearing chatter that as much as 142-200k bitcoin could be released back into the market, which amounts to up to around $8 billion worth of bitcoin.