28 Mar 2022

Market update: Bitcoin trading at yearly highs

Is the tide turning in the crypto market?
In the last seven days, bitcoin (+11%) has seen strength followed by strength, leading it to reach yearly highs, currently trading at $47,500. Bitcoin's strength could be caused by the sustained accumulation from the Luna Foundation Group.ETH (+13%) is following bitcoin closely, slightly outperforming BTC over the last seven days, while the 90-day correlation grows further. BNB has slightly underperformed, seeing 7% gains in the last week.
Source: CoinMetrics
The 90-day correlation between BTC and the S&P 500 is still climbing and now sits above 0.5. While bitcoin currently experience a unique structural buying pressure caused by LFG’s BTC reserves strategy, the growing correlation to equities suggests that the strong stock market recovery has impacted the recent strength witnessed in bitcoin.
Source: CoinGecko,
Waves is this week's winner among the top 50 by market cap after seeing a massive 293% gain over the last month. Meanwhile, LEO figures as the worst performer. This is interesting, given LEO’s underlying relationship to BTC following the seizure of the hacked funds. However, LEO is still trading at a significant premium of 60% to the valuation of the seized BTC at current prices.
Source:, Bitfinex
While all other indexes see acceptable gains in the 8-10% range in March, the Small Cap Index has surged 40%.The Small Cap Index’s massive gains come primarily from a few coins. Its largest constituent, Waves, is up 300% in the last month and is also the winner of the top 50 coins by market cap during the past seven days.The current market sentiment, measured by the Fear and Greed Index, just reached a four-month high, which is promising for the smaller and riskier coins.
As the bitcoin dominance has been sitting at its highest levels since November, now might be a time for altcoins to shine again, given that the optimistic market sentiment continues.
The Fear and Greed Index sits at its highest level since early November as optimism returns to the market. Still, market participants should keep in mind that every time we have shown the slightest sign of greed this spring, the market has slammed us back into a fearful state. Is this time different?
Source: Skew, Tradingview (Binance, Binance US, Bitfinex)
The 7-day average real bitcoin trading volume* sits at $4.6 billion, a slight increase from last week but still a meager amount historically. Spot volumes have been remarkably stable lately with no significant spikes, and it's more than a month since we last saw a single day with more than $10 billion of bitcoin change hands. Is there enough buying power out there to keep the bitcoin price rising?
Source: Tradingview (Coinbase)
In the last seven days, the bitcoin price has been slowly grinding upwards with daily 1-2% ticks on most days, as you can see on the chart. The 7-day volatility just hit a two-month low after seeing a volatility uptick at the beginning of March.
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