SignalPlus Volatility Column (20230830): Good news strikes, and the market clears away the gloom

Last night (29 Aug 10: 00 pm UTC+8) the JOLTs job vacancies announced by the United States in July recorded 8.827 million, which was significantly lower than the market expectation of 9.465 million, which exacerbated expectations of weak non-agricultural employment data on Friday; It fell to 106.1, below expectations for a reading of 116, showing a decline in economic momentum. Market bets that the Fed will pause rate hikes in September increased after the data, while lowering expectations for a resumption of rate hikes in November. U.S. bond yields fell by 10 basis points across the board to a two-week low. The two-year U.S. bond yield, which is more sensitive to policy, fell 16 basis points from an intraday high at one point, and rebounded slightly after breaking through the 5.0% and 4.9% mark. back above 4.9%.

Source: SignalPlus

Although the narrative in the encryption circle was slightly weak some time ago, resulting in sluggish price increases, just last night, Grayscale (Grayscale) won the lawsuit and overturned the SECs decision to prevent the Grayscale ETF from going online. BTC briefly broke through $28,000 (+ 8%), ETH is also actively challenging the 1750 mark (+ 6.1%), and the short-to-medium term IV of the option market has risen in a straight line. Ushered in nearly two hours of carnival.

In response to the outcome of the lawsuit, the court stated that “theThe (SEC) rejection of Grayscales proposal was arbitrary and capricious because the SEC failed to account for the different treatment of similar products.On October 12 last year, Grayscale filed an opening brief on the SEC’s rejection of its application for a Bitcoin Spot ETF, stating that the SEC had failed to demonstrateWhy Approvals for BTC Futures ETFs and Spot ETFs Are Treated Differently, which violates the most basic requirements of the Administrative Procedure Act of the United States.

Bloomberg ETF analyst James Seyffart said on Twitter that Grayscales victory in the lawsuit does not mean that GBTC can be freely converted into ETFs, but it takes the conversion one step closer. He also mentioned that the SEC is available atWithin 45 daysFile an appeal for a full hearing, meaning the case will be heard by all (17) judges on the court, rather than a 3-judge appeals panel as in this initial ruling.

Source: Deribit (as of 30 Aug 16:00 UTC+8)

After a brief carnival, the price of BTC dropped slightly from the high of 28,000 to around 27,500, and the implied volatility at the front end also gave up more than half of the increase, but the overall price was still at the high quantile level in the past month (75 %) interval, curveFrom steep to flat; On the other hand, on the ETH side, the market fully digested the positive sentiment brought by the news overnight, the front-end IV returned to the level of the previous day, and the far-end volatility evenContinuing yesterdays decline, there has been a drop of about 1-2%.

Source: SignalPlus,IV pulls up quickly and then falls back gradually

Source: SignalPlus

Grayscales victory in the lawsuit is undoubtedly a major victory for digital currencies in terms of regulation. In terms of transactions, we can see that this wave of pullbacks has refocused the markets attention on the upside of BTC/ETH. A large number of Call Spread transactions have driven a significant decline in the P/C Ratio, but the proportion of active buying and selling is not high. There is no obvious gap. In this market, the big traderspresents a relatively balanced situation to the market. In fact, the digital currency market is still in a state of lack of liquidity, and the narrative environment has not undergone decisive changes that can attract a large number of new funds to enter the market. The relatively large fluctuations in recent times often brought a short-term increase in trading volume to the market but lacked the follow-up thrust to continue the trend. What the market may be waiting for is further clarity on the overall environment, which will bring greater potential to market activity.

Source: beincrypto,Detailed list of all spot BTC ETF applications being evaluated by the SEC

Source: Deribit Block Trade

Source: Deribit Block Trade

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