As bitcoin struggles to hold the $10,700 price range UniswapÃ¢ÂÂs September volume set records but appears to be declining.
- Bitcoin (BTC) trading around $10,757 as of 20:00 UTC (4 p.m. ET). Slipping 1% over the previous 24 hours.
- BitcoinÃ¢ÂÂs 24-hour range: $10,621-$10,924
- BTC above its 10-day moving average but below the 50-day, a sideways signal for market technicians.
BitcoinÃ¢ÂÂs price dropped a couple of hundred dollars as a spate of selling took the worldÃ¢ÂÂs oldest cryptocurrency to as low as $10,621 on spot exchanges such as Coinbase, recovering to $10,757 as of press time.ÃÂ
Katie Stockton, analyst for Fairlead Strategies, says cryptocurrencies like bitcoin are affected by traditional markets, particularly equities, which are considered Ã¢ÂÂrisk-offÃ¢ÂÂ or liquid assets that can easily be sold during a market slide.ÃÂ
Related: Bitcoin May Return to Center Stage After EthereumÃ¢ÂÂs White-Hot Summer
Ã¢ÂÂBitcoin has been attuned to the day-to-day moves in risk assets, but the end result of the intraday volatility is a consolidation phase on the chart,Ã¢ÂÂ said Stockton. Ã¢ÂÂShort-term momentum has improved with equities, so I expect the consolidation to give way to a move that leaves support near $10,000 intact.Ã¢ÂÂÃÂ
Global equities markets are weak today, either flat or down:
Michael Gord, chief executive officer of crypto trading firm Global Digital Assets, senses a bearish mood for the crypto markets. Ã¢ÂÂBitcoin might get over $11,000 for a short period this week, but with a big exchange like KuCoin being hacked over the weekend I expect this week to have a more bearish sentiment with retail investors,Ã¢ÂÂ said Gord. Ã¢ÂÂInstitutional investors, on the other hand, might be taking this buying opportunity to buy cheaper bitcoin.Ã¢ÂÂÃÂ
Read More: KuCoin Maintains Wallet Freeze as Hackers Begin Laundering Stolen Crypto
Related: Regulated US Exchange Gemini Now Offers Confidential Zcash Withdrawals
Several stakeholders in the crypto market see a lack of yields coming from traditional markets as a sign cryptocurrency has a place in uncertain times.ÃÂ ÃÂ
Ã¢ÂÂWe are moving into a period of stagflation Ã¢ÂÂ stagnant growth and inflation Ã¢ÂÂ which creates a steepening of yield curves in the fixed income world,Ã¢ÂÂ said Chris Thomas, head of digital assets for Swissquote Bank.ÃÂ
Indeed, U.S. Treasury yields have dropped in 2020 Ã¢ÂÂ the two-year maturity is at its lowest yield in over 10 years.
Ã¢ÂÂI have a customer leaving bonds for bitcoin. I look at that as very bullish,Ã¢ÂÂ said Henrik Kugelberg, a Sweden-based over-the-counter crypto trader. Ã¢ÂÂBonds that are supposed to be the safest bet there is to actually make a buck on your invested money now all of a sudden seems less attractive than bitcoin.Ã¢ÂÂ
Uniswap volume dips
Ether (ETH), the second-largest cryptocurrency by market capitalization, was down Tuesday trading around $356 and slipping 1.5% in 24 hours as of 20:00 UTC (4:00 p.m. ET).ÃÂ
Read More: Bitcoin May Return to Center Stage After EthereumÃ¢ÂÂs White-Hot Summer
Uniswap has had a stellar September, with the decentralized exchange, or DEX, having a record $953 million in volume on the very first day of the month. Since then, however, volume has declined.ÃÂ
Toward the end of Tuesday, volume was $312 million, lower than SeptemberÃ¢ÂÂs $468 million daily average.
Ã¢ÂÂUniswap is by far the most successful decentralized trading venue, some days rivaling its centralized counterparts,Ã¢ÂÂ said Brian Mosoff, chief executive of Ether Capital.ÃÂ
However, volume doesnÃ¢ÂÂt mean everything for a DEX: Mosoff points to UniswapÃ¢ÂÂs Tuesday record-high of $2.29 billion in liquidity, which is the depth, or availability, of assets traded on the DEX, as a metric traders should also consider.
Ã¢ÂÂLiquidity has just reached a new all-time high on Uniswap Ã¢ÂÂ this means that asset pricing is becoming more competitive and because of this it may capture the majority of trading volume once speculative activity abates,Ã¢ÂÂ Mosoff added.
Digital assets on the CoinDesk 20 are mostly in the red Tuesday. One notable winner as of 20:00 UTC (4:00 p.m. ET):
Notable losers as of 20:00 UTC (4:00 p.m. ET):
- orchid (OXT) Ã¢ÂÂ 10.3%
- chainlink (LINK) Ã¢ÂÂ 8.3%
- 0x (ZRX) Ã¢ÂÂ 8.2%
Read More: Traders Rotate to Bitcoin Expecting a Quiet Q4 for Altcoins
- Oil was down 3.7%. Price per barrel of West Texas Intermediate crude: $39.03.
- Gold was in the green 0.86% and at $1,896 as of press time.
- U.S. Treasury bond yields all fell Tuesday. Yields, which move in the opposite direction as price, were down most on the two-year, dipping to 0.123 and in the red 4.5%.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.