Key Takeaways

  • Bitcoin has failed to break out of this extensive wedge pattern despite multiple attempts recently. In mid-February, BTC briefly jumped above $10,300 but its time above $10k was short-lived, marking its 2020 peak (at least thus far). It retested this resistance level in early May, early June, and then again just this past week to no avail.

 

  • Bitcoin has been trading in a relatively tight range over the last month, spending a vast majority of time between low $9,000s and $10k. BTC’s 30-day volatility has dropped to its lowest level of the year, which historically has preceded sizable price moves as vol reverts.

 

  • The correlation between BTC and US equities has tightened considerably in recent weeks as concerns mount over the recent rise in confirmed COVID-19 cases. With the economy still in shambles, confidence in the sustainability of the risk-on rally is being tested, which could push equities lower. Additionally, we’re rapidly approaching a key inflection point as policymakers debate if and when to deploy their next wave of relief measures before the fiscal support cliff drops.

 

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