Market Wrap: Bitcoin Rangebound; Lags Crypto Stocks

Bitcoin was mostly flat on Friday as buyers and sellers appear to be in a stalemate. The world’s largest cryptocurrency is up about 6% over the past week and is expected to hold support above $30,000 into the weekend. 

In traditional markets, the S&P 500 and Nasdaq reached all-time highs after a better-than-expected U.S. jobs report on Friday. For now, sentiment for risky assets appears to be alive as well as volatility declines in both traditional markets and bitcoin. 

Bitcoin’s implied volatility remains elevated despite rangebound trading since mid-May, according to options data provider Skew. This suggests traders are not complacent given the recent stabilization in price. There is still some uncertainty present in the options market at the beginning of July. 

“$34,000 is a key level for accelerated moves to the up or downside with highest gamma exposure for both puts and calls,” Pankaj Balani, CEO of Delta Exchange, wrote in an email to CoinDesk.

“As spot trades lower, the market has yet to find its footing,” Balani wrote. “As long as players write upside exposure in size, a rangebound play with more downside risk seems likely.”

Crypto related stocks such as Coinbase (NASDAQ: COIN) and Riot Blockchain (NASDAQ: RIOT) have outperformed bitcoin over the past few months, albeit within a tight range. Some traders are looking for a breakout or breakdown in stocks as a leading signal for bitcoin in the coming weeks. 

COIN registered a downside exhaustion signal in June, confirmed by DeMark indicators. The stock will need to see a break above $260 to shift the downtrend since its April debut.

The bitcoin market could get a boost this month from the expiration of investor restrictions on the sale of shares in the Grayscale Bitcoin Trust (GBTC), the world’s largest cryptocurrency fund. Grayscale is owned by the Digital Currency Group, which is also the parent company of CoinDesk.

Some digital asset analysts and investors say it’s possible some of these investors might need to enter the market to buy bitcoin in order to repay cryptocurrency loans they used to finance their original purchases of the GBTC shares.

Most digital assets on the CoinDesk 20 ended up lower on Friday.

Notable winners as of 21:00 UTC (4:00 p.m. ET): 

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