Tesla Pain

Crypto Market Week in Review (23 December 2022)

Markets

This week the markets continued to be in a risk-off mood. Both stocks and bonds declined. The most important macro news came from Japan, where the Bank of Japan unexpectedly loosened yield curve control, making its monetary policy a bit tighter. That led to a rally of the Japanese yen and a modest decline of both global stocks and bonds.

The most notable move of the week was in Tesla shares, which plummeted by 17% during the week. Tesla stock lost about 65% this year and returned back to September 2021 levels. This week's drop was spurred by the news about a price discount for new cars made by Tesla, and the down move was probably reinforced by a tax loss selling near the year-end.

Tesla share price (USD)

Bitcoin was flat but Ethereum advanced by about 5% since the last Friday. Both coins outperformed most risk assets. Binance coin (BNB) was up for the week despite continued negativity about the exchange. Lido DAO token dropped by 12% since the last Friday, reaching the lowest level since July.

The implied volatility of both Bitcoin and Ethereum (as measured by DVOL indexes) attempted to increase during the last weekend and on Monday, but after that declined back to all-time lows.

Bitcoin DVOL index

The volatility curve turned into a big contango as the spread between the 30-day and 7-day implied volatility of Bitcoin reached 10 points. It seems that the options market expects calm Christmas despite Binance worries.

Bitcoin 7-day and 30-day at-the-money implied volatility

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