Key Indicators
(Hong Kong time: 4:00 p.m. July 13 to 4:00 p.m. July 20): — BTC/USD up 2.0% ($62,900 → $64,150); ETH/USD up 4.2% ($1,785 → $1,860)
BTC/USD spot technical outlook
Last week’s BTC (and ETH) price performance remained strong relative to the broader market. Overall, it aligns with the medium-term technical analysis we have been tracking continuously over the past several weeks, and it was also driven by rising expectations that the (CLARITY Bill) would make progress in the U.S. Congress before the summer recess begins on August 8. In the short term, despite widespread risk-aversion sentiment in equities triggered by de-leveraging related to the Korea Composite Stock Price Index (KOSPI) and AI-related trading, and despite further escalation of the situation surrounding the Iran–Israel conflict, BTC has still found support above $62,000. Meanwhile, the $64,500 to $65,000 zone continues to present strong resistance. — At present, we still expect price to grind higher via a sideways-to-rangebound consolidation, and we also note the positive signal of short-term lows continuing to be set higher. As the (CLARITY Bill) becomes the market’s focus, related news may add some noise and disrupt near-term technical trends. However, we remain focused on the support zone at $60,000 to $61,000. If that area breaks, price may first attempt to probe down toward $58,000, potentially followed by a final leg of sub-wave decline, with targets pointing to $50,000 to $55,000. On the other hand, if price clearly breaks above the resistance near $64,500 to $65,000, we expect it first to attempt a move through $68,000, and then to probe further toward stronger resistance around $74,000. At that time, the market will ultimately need to determine whether this round’s low has already formed and whether price will continue to rally strongly, or whether price will weaken again—followed by one last break below $60,000—before a more substantive upward move in the year can truly begin. ## Market Theme - Last week, the market overall showed risk-averse sentiment. Although below-expected CPI data briefly boosted risk assets early in the week, the Iran–Israel situation continued to heat up and ultimately started to transmit into oil prices. Brent crude broke above $90 per barrel, up slightly more than 20% from the recent low. Meanwhile, de-leveraging continued in the stock market via KOSPI and AI-related trading. More and more Korean young-adult retail insolvency cases have emerged, and regulators have begun taking steps to limit further leveraged trading in the short term. Overall, we view the latter as a healthy adjustment for the market; whereas the former could continue to weigh on risk assets throughout the summer. If geopolitical uncertainty remains prolonged, oil prices may stay elevated and interest rates could remain higher for a longer period. With no clear solution visible at present, tail risks from escalation or misjudgment are increasing. — Overall crypto market sentiment improved, and statements from the White House boosted optimism toward the (CLARITY Bill). As the summer recess approaches, the window for the bill’s approval is narrowing. After the recess, midterm elections may become the dominant factor in the political agenda, which could delay the bill’s passage to 2027. The market continues to record ETF inflows, but the $64,500 to $65,000 area still faces strong resistance. Currently, overall market positioning feels very light. Short-term traders covered shorts when price was pushed down to $64,000, while medium-term investors have clearly reduced or exited positions over the past 4 to 6 weeks; we also continue to observe a trend of miners selling coins. Although the market has built some upward exposure over the next two weeks, if the (CLARITY Bill) is passed within the next 2 to 3 weeks, the market may be forced to chase the move higher, pushing BTC up to $68,000. The probability of passage shown by Polymarket is 38%, implying that once the bill is finalized, upside room could still be substantial. On the other hand, if the Middle East war keeps risk-averse sentiment elevated and the (CLARITY Bill) fails to pass within the next 2 to 3 weeks, disappointment could drag BTC back down to the $60,000 to $61,000 range. Because ETH was previously driven by optimistic expectations and has outperformed BTC, if sentiment reverses, ETH may be more prone to a quick dip toward $1,600.
BTC volatility
Implied volatility overall fell last week. Even though realized volatility ticked up from the extremely low levels of the week before, most of the volatility was still driven by event factors—primarily the CPI data and optimistic market expectations for the (CLARITY Act). As we move into mid-summer, market participation continues to decline, and investors are becoming increasingly comfortable with BTC temporarily holding within a broad $60,000 to $66,000 range. The only exception is that, from the July 31 expiry contracts, there was some upside demand with high leverage—used to hedge potential scenarios where the (CLARITY Act) could be accelerated before the summer recess. This also pushed up implied volatility for that maturity. Even so, this remains a highly concentrated short-term bet. Even if the bill is approved, the market has not shown interest or expectations for structurally sustained price upside formation. On the other hand, with spot positions in the market clearly reduced, we did not observe any significant demand for downside hedging. Meanwhile, covered call option sellers continue selling options on both sides of the price range to enhance returns in the current range-bound environment. — As the market officially enters summer and spot prices continue to consolidate within this equilibrium band, the term structure of implied volatility has started to become steeper. We still expect realized volatility to pick up starting in September, especially considering the U.S. midterm elections and the overall macro backdrop. Market expectations for the first Fed rate cut have been pushed back from July–August to September–October. However, given that we are currently approaching mid-summer, the market has not yet shown interest in the trading performance for September and October. This has further reduced forward volatility valuations in the far-end of the curve to the lower end of the past two years’ range, and we believe that current levels may be a good time to start accumulating long positions as a value investment strategy.
BTC dollar skew / kurtosis
The skew pricing for last week’s options on the downside was less tilted toward put options, mainly because the coin price continued to show relative strength in an external risk-off environment, while upside demand in short-dated tenors began to transmit into the broader volatility curve. We also observe that some covered-call sellers, who previously were primarily selling call options, started incorporating the sale of downside options into their strategies. This reflects that as recent price lows have kept rising, they are beginning to show some confidence in the downward price trajectory. — Current kurtosis pricing has found some support near existing levels. As skew is repriced, downside-end volatility appears relatively low compared with recent levels. Given the current geopolitical backdrop, the market still is not willing to sell tail-downside risk at too low a price. In addition, because MSTR and STRC have not shown any clear signs of recovery, Saylor may still need to continue selling assets over the coming months, so the market remains cautious about tail-downside risk. On the upside, demand for outright long call options and narrow call spreads has, overall, absorbed some upside wing volatility. Earlier, due to heavy covered-call option selling, the market had accumulated a relatively large net long exposure to volatility in that area. With this supply pressure easing now, it also further supports kurtosis pricing.
Wishing you smooth trading this week!
