1/ macro and options view from fresh highs:
our trading desk is bullish on crypto in the near term, led by the range breakout in BTC above its recent highs of $112k. we see $125k as the first target, which will lead to a repricing higher across the altcoin complex
2/ despite BTC dominance coming off highs from 66% to 64.5%, we still see alts continuing to lag the rally going forward
tradfi capital is flooding into DATs, which are concentrated in majors. besides that crypto-natives care more about fundamentals and KPIs this cycle
3/ BTC is moving in line with gold in recent weeks, as the USD debasement trade continues. Meanwhile, there are many constructive catalysts for crypto, such as the GENIUS bill, potential inclusion of MSTR in the S&P 500, and the approval of staked crypto ETFs.
4/ directional traders are underexposed to the recent breakout, having been chopped up in the recent $100k-110k range multiple times and being unwilling to grab beta for the upside.
5/ at the same time, there is a decent amount of complacency on the short vol supply, with miners supplying call overwrites driving the compression in realized vols, and hence driving implied volatility to multi-year lows
6/ from here, we think there is a significant chance of repricing higher in implied volatility as natural options supply from miners has generally passed, and will likely remain muted until we reach the $130k level
7/ CPI will be key on Tues: Powell called out June and July CPI releases as the first key data points around tariff-induced inflation
downside or in-line prints relative to expectations will be read positively by risk assets, helping to fuel the current bull market in crypto
8/ Tariff concerns are a risk to consider. Markets at ATH create space to double down on more onerous trade policy. Consensus views tariff headlines as a negotiating tactic. Hence, there could be short-term equity weakness given the more pronounced left-tail risk on growth.
9/ On balance, in the desk’s view, the recent decoupling of crypto vs BTC with respect to risk assets over the past few days is extremely constructive for near-term upside in price.
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