Risk-Off Impulse Sends Crypto Prices Below Reclaim Levels

The cryptocurrency market saw significant decline last week, with Bitcoin and Ethereum prices falling below their reclaim levels. The week's performance was marked by a risk-off impulse triggered by geopolitical events, particularly Iran-linked risks that drove oil prices up by 7.3%. This move was accompanied by a spike in the VIX index to 18.58, indicating increased market volatility.

The US spot Bitcoin and Ethereum ETFs saw net outflows of $460M and $555M respectively, despite a single-day inflow of $132.3M on Monday for Bitcoin. This pattern is seen as a rejection of the price movement, rather than a sign of repair. In contrast, Solana and XRP wrappers continued to see inflows.

The author notes that this week's move should be read as continued distribution, rather than a fresh breakdown or start of repair. Price remains below reclaim levels for both Bitcoin and Ethereum, and flows are net negative on the week. The equity backdrop also deteriorated, with the Nasdaq and S&P 500 indices falling by 4.92% and 2.12% respectively.

For this drawdown to be read as anything other than a repricing lower, both Bitcoin and Ethereum need to hold above their respective reclaim zones. However, this has not been confirmed yet. The author emphasizes that repair requires price to reclaim the level that failed to hold on the way down, together with ETF outflows slowing and staying slowed across a full week.