We are in the midst of summer, a period that historically brings low volatility in financial markets and this year seems to follow the same trend.
The crypto market has indeed slowed down, with BTC remaining relatively stable around $60k in recent weeks.
In today's episode of Market Insight, we analyze the volatility and general market condition of the last few weeks for all assets integrated within the MetalSwap dApp and beyond.
We are experiencing a fairly calm period for the commodity sector, with the reference ETF remaining quite stable around the value of 23 over the past few weeks.
Invesco Commodity ETF
Controlled inflation and the American economy not showing signs of a slowdown are important factors that reassure the market and make it less volatile.
However, there are still many catalysts that could stir the markets, with the numerous ongoing wars being a significant factor.
After reaching its peak and completing the halving, Bitcoin has slowed its growth, and consequently, the entire sector has followed suit.
Bitcoin price action
In the previous episode of this series, we observed bitcoin hitting a new all-time high. Today, the situation has changed, with BTC currently down 14% from its peak.
In general, the past few weeks have seen relatively low volatility, resulting in a stable price range between $55K and $65K.
As we can see from this chart, BTC's volatility is now around 50, after surpassing 85 in the early months of the year.
Bitcoin volatility index
Ether price action
The last few trading days have pushed the price of ETH above the key resistance level of $3,300. This price action is still very similar to BTC's, although it can be described as slightly more volatile, with the May 20th candle leading to millions of dollars in liquidations.
However, ETH has a significant catalyst that could influence its price action: the start of trading for its spot ETFs.
These were approved about a month ago, but trading has not yet started as they are awaiting specific documentation called S-1.
This documentation is expected to be approved by the U.S. SEC this week, and thus, ETH's price could experience significant movements in the coming days.
Gold price action
In the last episode of this series, we celebrated gold reaching a new all-time high of around $2,200.
A few months later, gold has continued to rise, and at this moment, an ounce of gold is worth over $2,411!
The reasons for this increase are undoubtedly found in the global uncertainty related to the numerous ongoing wars and potential conflicts in the coming months.
This uncertainty has led to a unique situation where gold is at historic highs, yet the stock market is also hitting new highs.
The OP token has been one of the hardest hit during this quiet summer period within the sector.
After reaching a high of over $4.80 in March 2024, the token is now trading at $1.80, having hit a relative low of $1.25.
As we mentioned in the last episode, this is one of the most volatile crypto-assets, and implementing hedging strategies through MetalSwap can make a real difference during periods like the ones we’ve seen in recent months.
After the first quarter of 2024, characterized by euphoria and high volatility, we are now experiencing a calmer and more stable period.
Nevertheless, volatility will return, both due to internal sector reasons, such as the launch of Ethereum ETFs, and external factors, such as the geopolitical situation or the outcome of the U.S. elections.
For any eventuality, MetalSwap is the tool suited to either neutralize this volatility or leverage it to secure extra profits.
-The DeFi Foundation
✎ What is MetalSwap?
MetalSwap is a decentralized platform that allows Hedging Contract on financial markets with the aim of providing coverage to those who work with Digital Asset and an investment opportunity for those who contribute to increase the shared liquidity of the project. Allowing the protection for an increasing number of operators.
With Hedging Contract we enable hedge swap transactions through the use of Smart Contracts, AMM style.
It's great to Hedge the Risk of Price volatility with MetalSwap dApp !