DXY Strength Weighs on Crypto, ETH ETF Expected Early July
Crypto Market Update
Crypto has resumed its recent weakening trend following a weekend pump, with BTC testing the $65k level, ETH trading around $3500, and SOL approaching $140. The ETHBTC ratio is declining again after a weekend relief rally sparked by news from Bloomberg ETF expert Eric Balchunas on Friday evening, clarifying his timeline for the ETH ETF launch. Meanwhile, the DXY continues its upward trajectory from the post-CPI selloff, driven today by a rebound in rates across the yield curve. Equities show a mixed picture today, with the ^SPX 0.13% slightly down and QQQ slightly up, led by gains in the tech and consumer discretionary sectors, although larger cap names are dragging indices lower. Looking ahead, the macroeconomic calendar is relatively subdued this week, with key events including tomorrow’s retail sales data in the U.S. and significant UK inflation figures alongside the BOE interest rate decision, offering insights into European economic conditions and potential implications for the DXY’s continued strength.
Early July Launch for ETH ETF Still Seems Likely
Bloomberg ETF expert Eric Balchunas moved up his target date for the ETH ETF launches to July 2nd, based on the pace of interactions between the SEC and ETF issuers. It appears that the SEC staff has already sent issuers comments on the S-1s, and that these comments are relatively light, indicating they could be addressed this week. While this is not a major shift from the prior expectation of July 4th, reading between the lines suggests that many had anticipated a further deferral into summer. The ETH/BTC ratio rallied for the first time in several days over the weekend following Balchunas’ optimistic outlook.
Tether Launches Gold-Backed USD Stablecoin
Tether, the leading stablecoin issuer, has launched Alloy by Tether, a digital asset backed by Tether Gold. Alloy by Tether introduces a new category of tethered assets designed to ensure stability by pegging to reference assets through over-collateralization and secondary market liquidity. The first token, aUSDT, tracks the US dollar and is over-collateralized with Tether Gold (XAUT), backed by physical gold deposits in Switzerland. This combination allows users to engage in transactions backed by actual gold without selling their gold reserves. Operating on the Ethereum Mainnet, Alloy by Tether supports transparent management of tokens and collateral through smart contracts, paving the way for potential expansion into yield-bearing products and integration into institutional portfolios under regulated oversight in El Salvador.
Technical Strategy
STX pullback under May lows likely postpones its rally and results in additional near-term consolidation before this can start to work its way back to new highs. Stacks managed to retrace approximately 50% of the prior low to high range into March 2024 peaks. However, despite the churning in price near this 50% level, STX has failed to show any evidence of meaningful bottoming out that would suggest this three-month decline had run its course. Monday’s pullback under $1.80 has reached the 61.8% Fibonacci-based retracement zone of the prior run-up. However, the act of undercutting $1.80 is structurally bearish, and likely allows for further weakness down to $1.50 which should provide meaningful support as a DeMark-based TDST level along with a TD Propulsion target. Overall, STX should offer an attractive opportunity near $1.50. However, given Monday’s support violation, a bit more weakness looks likely over the next couple weeks.
Daily Important Metrics
All metrics as of 2024-06-17 12:00:24 All Funding rates are in bps Crypto Prices
All prices as of 2024-06-17 11:49:57 Exchange Traded Products (ETPs)
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