Markets Whipsaw Amid Growing Instability

As many expected, the Russian invasion of Ukraine continues to threaten global stability as the humanitarian cost grows beyond disheartening. Several developments this week have critical implications for the global economy, but at a high level, the primary facets being higher energy and commodity prices, the latest wave of financial sanctions, and the growing risk of implosion within the Russian economy.

Given Russia’s pivotal role as a significant producer and exporter of petroleum products and natural gas – especially for European importers – the surge in energy costs and commodity prices are one of the most significant risks in the short to medium-term. Broad bans by major powers on business activities with the Bank of Russia and its financial sector also have tremendous consequences, as evident in the collapse of the Russian ruble and the value of Russian assets over the last few weeks.

Similar to last week, we wanted to highlight resources to donate to those aiding in ongoing relief efforts in Ukraine. For starters, the official Ukraine Twitter page has some great resources. Additional charities include Save The Children, which has been operating in Ukraine since 2014 (see here), and the International Medical Corps, as they prepare to provide essential emergency and primary health services in Ukraine (see here). For a more exhaustive list of charities, see this thread published by The Giving Block.

Crypto Market Stages Impressive Rally

We published a Market Insights report in mid-February highlighting the multiple timeframe BTC resistance levels near $45K. Notably, this week’s most recent price rally saw BTC top out between $45K-$45.5K (depending on which trading venue you track).

• About a week ago, the Russian invasion of Ukraine caused global markets to tumble, with BTC bleeding out as it explored the bottom high volume node.

• Since then, BTC has rebounded sharply from the $34K lows to around $45K. Bitcoin has continued to range within this HVN, but its price is now consolidating on the edge of this HVN. When price eventually breaks away from the boundaries of this HVN, it is likely to move with purpose.

Zooming in a bit, the following are key levels that are worth highlighting given the recent price dump and subsequent rally out of the lows.

• Support at $34K: During the January hawkish Fed news cycle, markets nuked into $34K support before staging an impressive rally. As Russia invaded Ukraine, markets nuked into $34K support before staging an even more impressive rally. Price has since bounced to $45K, but a revisit of the $34K support level is certainly not out of the question given the uncertainty of the geopolitical landscape.

• Support at $28.5-$30.5K: If the $34K level fails to hold, look to the weekly market structure support above, roughly on around $28.5K-$30.5K.

• Resistance from Trendl