QCP Weekend Brief – 12 Jul 24

Some stability returned to the market this week with BTC and ETH making a decisive recovery to 58k and 3100.

What caused this relief rally?

1. Positive macro sentiment with inflation slowing down. The market is now pricing 95% chance for a rate cut in September.

2. ⁠The German Govt has completed their 50k BTC sale and spot price has held up well.

3. ⁠Strong demand from the spot ETFs with around $1B of net inflow this week.

What is the vol market telling us?

While crypto twitter and retail sentiment has been screaming panic, large hedge funds have been confidently and aggressively buying BTC topside, particularly December and March calls targeting 100-120k price level.

What is the best play here?

BTC accumulators are more compelling than ever with spot stabilising at these levels and steepness of the vol curve.

BTC Accumulator
Buy BTC spot at 13.5% discount (50k)
every week as long as spot is below 65k

Maturity: 27DEC24 (24 weeks)
Strike: 50,000 (-13.5%)
Upper Barrier: 65,000 (+12.5%)
Observation Frequency: Weekly

Spot ref: 57,800 BTCUSD