TrigonX's Digital Asset Market Review

TrigonX – Bitcoin has continued to consolidate during the first week of June with its price ranging between $29,300 and $32,400. This consolidation has happened while the S&P 500 has bounced from 3,800 to 4,200. With the current poor economic conditions, this could be a false rally for the SP500 and further downside may be on the cards for the coming weeks. If the SP500 does move lower, it will most likely drag Bitcoin’s price with it. Looking towards the end of the week, US inflation data will be released Friday [10 June 2022 at 22:30 AEST] which could be a catalyst for potential moves lower.

Previously, when looking at the overall price model and the realised profit/loss for each coin, we can see that Bitcoin has a realised price of approximately $23,600 which represents the estimated average cost basis of all coins in the Bitcoin supply, based on the price when they last moved on-chain. Historically, the overall market cost basis or realised price has been a very sound cycle support level, with 84.9% of Bitcoin trading days closing above this level. In other words, only 15.1% of trading days have closed below the realised price. Therefore, there is a chance that before Bitcoin and the overall market structure changes and makes any significant moves, its price could test the realised price level of $23,600 (see below).

Australian Macro News – Interest Rate Hike

On Tuesday the RBA hiked Australian Interest Rates for the second time this year, reflecting policy makers’ deep concern over raising inflation. The cash rate was increased by 0.50% to 0.85%, sparking strong volatility in AUDUSD and a sharp decline in the ASX200. AUD has been trending upwards since the last rate hike which should continue with the latest rate increase having exceeded expectations. The RBA also promised that there will be further rate hikes this year as they aim to bring inflation back inline with their 2-3% target; from the current rate of 5.1% p.a.