Stormrake - Insights #Trump Tariffs

Ethereum Is Falling Behind—But Smart Money Keeps Accumulating

Thu, 06 Feb 2025 13:01:39 +1100

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Bitcoin has endured another bearish 24 hours, continuing its downward trend. With no major macroeconomic catalysts expected until the release of US CPI data on the 13th, the coming week should allow the crypto market to trade freely without external economic influences. Of course, a week is a long time in markets—especially in crypto—and with the current political landscape, one can never get too comfortable.

Ethereum’s Underperformance: A Cycle of Disappointment

This has been a cycle of underperformance for Ethereum. While its main competitor, Solana, has posted multiple all-time highs, Ethereum has failed to break new ground. In fact, since Bitcoin first hit $100K in December, Ethereum has only moved backwards. At the time, ETH was trading at $4K—I’ll let the following image tell the rest of the story:

Source:https://x.com/uputkucrypto/status/1886676383880958182

Ethereum’s underperformance has come as a shock to many. Back in 2021, when market euphoria was rampant and Bitcoin was predicted to hit $100K, many expected Ethereum to reach $10K. Four years later, Bitcoin has surpassed $100K multiple times, yet Ethereum has failed to impress. This cycle’s high of $4.1K is still 15% below its 2021 all-time high of $4.9K. Currently, ETH sits 43% lower than its peak—hardly the performance many had anticipated.

Institutions Accumulate Ethereum at Low Prices

Despite retail investor disappointment and negative sentiment, major institutions have been aggressively accumulating Ethereum at these lower prices. We’ve previously covered the mass buying by World Liberty Financial (the crypto project directly linked to Donald Trump). Additionally, Fidelity purchased another $50 million worth of Ethereum two days ago, and BlackRock—arguably the most influential player in the space—bought 100,535 ETH worth $284.92 million, as reported by @WhaleInsider on X yesterday.

When institutions accumulate at key levels, it makes sense to take notice. Following the smart money rarely ends poorly.

Stormrake Spotlight: Ethereum (ETH) ($2,766)

Source:https://www.tradingview.com/x/SQcrdUMY/

Ethereum remains extremely undervalued at current levels and is trading at the exact range where major players are accumulating. The identified major support level appears to be holding, reinforcing the case for accumulation.

BTC/USD Key Levels and Price Action:

Source:https://www.tradingview.com/x/xfFDiT6k/

Bitcoin remains within a consolidation range between $95.7K and $100K. Despite trading in this broader range, BTC’s overall trend remains bearish, struggling to flip bullish as the 55 EMA continues to reject attempts at a breakout to the upside.

BTC Total ETF Flows for 5 Feb: $ (data not available)

(ETF flow data is sourced from https://farside.co.uk/btc/ and reflects figures at the time of writing.)

ETH/USD Key Levels and Price Action:

Source:https://www.tradingview.com/x/w06IuUm6/

Ethereum is currently attempting to flip bullish and push toward the key resistance level of $2,865. If ETH can break above the 55 EMA, which has consistently acted as a resistance throughout this bearish trend, a bullish breakout could follow. However, failure to do so may see ETH retrace toward the lower end of the range at $2,556.

ETH Total ETF Flows for 5 Feb: $ (data not available)

(ETF flow data is sourced from https://farside.co.uk/eth/ and reflects figures at the time of writing.)

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*All prices are denominated in USD unless stated otherwise*

Written by Alexandar Artis

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No Advice Warning

The information in this newsletter is general only. It should not be taken as constituting professional advice from the author - Stormrake PTY LTD.

Stormrake is not a financial adviser and does not provide financial product advice. You should consider seeking independent legal, financial, taxation or other advice to check how the information relates to your unique circumstances. Stormrake is not liable for any loss caused, whether due to negligence or otherwise arising from the use of, or reliance on, the information provided directly or indirectly, by this newsletter.

Disclaimer

All statements made in this newsletter are made in good faith and we believe they are accurate and reliable. Stormrake does not give any warranty as to the accuracy, reliability or completeness of information that is contained here, except insofar as any liability under statute cannot be excluded. Stormrake, its directors, employees and their representatives do not accept any liability for any error or omission in this newsletter or for any resulting loss or damage suffered by the recipient or any other person. Unless otherwise specified, copyright of information provided in this newsletter is owned by Stormrake. You may not alter or modify this information in any way, including the removal of this copyright notice.

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Markets Wanted More—Sacks’ Speech Sends Bitcoin Lower

Thu, 06 Feb 2025 12:38:20 +1100

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David Sacks' speech this morning was far from bearish—yet it wasn't the announcement investors were hoping for. It seems that unless the market hears the exact words "The Bitcoin Reserve is here," it reacts negatively.

The Bitcoin Czar declared that the Golden Age for digital assets is upon us. Sacks revealed that his primary focus is evaluating the feasibility of a Bitcoin Reserve, while also reinforcing the crucial role of stablecoins in maintaining US dollar dominance on the global stage.

In the lead-up to the speech, crypto markets were rallying, with Bitcoin briefly touching $101K. However, as soon as Sacks began speaking, the market took a dive. Since 6:30 AM, Bitcoin is down over 3%, with most altcoins seeing double-digit losses—turning the charts into a sea of red.

As always, when Bitcoin sneezes, altcoins collapse. This highlights Bitcoin’s strength relative to the rest of the market. Bitcoin dominance currently sits at 61.41% and remains bullish, reinforcing the importance of prioritising Bitcoin exposure in uncertain times.

Stormrake Spotlight: Ethereum (ETH) ($2,865)

Source:https://www.tradingview.com/x/eAbbb86V/

Despite being the second-largest cryptocurrency, Ethereum is still an altcoin—and as mentioned above, altcoins fall when Bitcoin stumbles. However, ETH’s major support at $2,770 has held up well, despite repeated tests over the past few days.

During last night's bearish price action, reports surfaced that Fidelity had just purchased another $49.75 million of Ethereum. This marks the second consecutive day that a major player has accumulated ETH. If institutions continue buying at these levels, it signals that they see ETH as undervalued—a strong indicator that retail investors may want to follow suit.

BTC/USD Key Levels and Price Action:

Source:https://www.tradingview.com/x/kK8Bd6XL/

Bitcoin failed to hold above the key $100K level and has since bounced off support at $95.7K. Currently, momentum remains neutral, with moving averages trending sideways. Structurally, Bitcoin has confirmed a higher low but is still following a lower high, suggesting a consolidation phase between these two key levels.

BTC Total ETF Flows for 4 Feb: $ + 35.6 million

(ETF flow data is sourced from https://farside.co.uk/btc/ and reflects figures at the time of writing.)

ETH/USD Key Levels and Price Action:

Source:https://www.tradingview.com/x/18tHiBpZ/

Ethereum remains range-bound between $2,556 (support) and $2,865 (resistance). The structure remains bearish, with multiple lower highs forming. A move towards the lower end of the range is likely unless ETH can break above the 21 & 55 EMAs, which would open the door for a challenge of range resistance.

ETH Total ETF Flows for 4 Feb: $ + 4.1 million

(ETF flow data is sourced from https://farside.co.uk/eth/ and reflects figures at the time of writing.)

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*All prices are denominated in USD unless stated otherwise*

Written by Alexandar Artis

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No Advice Warning

The information in this newsletter is general only. It should not be taken as constituting professional advice from the author - Stormrake PTY LTD.

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From Panic to Profit: Crypto Rebounds as Trade Tensions Ease

Tue, 04 Feb 2025 15:32:18 +1100

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The past 24 hours have been a rollercoaster for cryptocurrency. Before many went to sleep, Bitcoin was trading in the low $90K region, and altcoins were down another 15%. But this morning, we've woken up to a sea of green.

The trade wars appeared to be in full swing, with markets reacting extremely poorly. A reported $2.3 billion in leveraged positions was liquidated from the crypto markets, marking one of the largest liquidation events in history. However, Bybit CEO Ben Zhou has challenged this figure, suggesting the real number sits between $8–$10 billion. Zhou backed up his claim by revealing Bybit’s actual liquidations over the last 24 hours, which stood at $2.1 billion—a stark contrast to Coinglass’ reported $333 million for Bybit alone.

The trade wars, however, seem to have taken a breather. Both Canada and the US have agreed to pause their recently announced tariffs for at least 30 days. In response, markets have rebounded, turning yesterday’s red into today’s green.

Market Recovery: A Reward for the Brave

Source:https://cryptobubbles.net/

Waking up to this market bounce was a pleasant surprise. As mentioned yesterday, those who took advantage of the extreme discounts have already started reaping the rewards. Bitcoin is back above $100K, Solana has reclaimed $215, and Sui and Ondo are both up 12% in the last 24 hours.

This bounce has stabilised the market and drastically shifted sentiment. Just yesterday, the Fear & Greed Index showed 25 (Extreme Fear). Now, it has jumped to 44, marking a significant recovery in investor confidence.

Eyes on David Sacks: The ‘Bitcoin Czar’ Speaks Tomorrow

Tomorrow, David Sacks, the ‘Bitcoin Czar’ and newly appointed head of the Digital Asset Stockpile, is set to hold a press conference. This event is expected to bring major updates on digital asset policies and regulation. Make sure to tune in at 6:30 AM AEST.

Stormrake Spotlight: Ethereum (ETH) ($2,865)

Source:https://www.tradingview.com/x/tTdVTwtl/

Ethereum is currently battling with the daily open to close green after an extremely volatile 24 hours. After dipping to a low of $2,079, ETH has staged a recovery, reclaiming the major support level discussed yesterday.

Yes, ETH is underperforming the rest of the market, but it also remains incredibly undervalued. The first time Bitcoin reached $100K, ETH was $4,000. Now, Bitcoin is back at $100K, but ETH is still 30% lower.

I’m not the only one seeing the opportunity here. Eric Trump (son of US President Donald Trump) just tweeted:

"In my opinion, it’s a great time to add $ETH. You can thank me later."

Pair that with World Liberty Financial—the Trump-linked crypto project—acquiring another 86,000 ETH ($220M USD worth) yesterday, and it’s hard to ignore the bullish signals for Ethereum.

BTC/USD Key Levels and Price Action:

Source:https://www.tradingview.com/x/TBcir962/

Bitcoin bounced perfectly off the new support CPR at $91.2K and found additional support at $92.5K before reversing 11% to reclaim $100K. BTC is now flipping momentum back to the bulls. If Bitcoin can hold above $100K and trade above its moving averages, we could see another attempt to flip $104K into support.

BTC Total ETF Flows for 3 Feb: $ (data not available)

(ETF flow data is sourced from https://farside.co.uk/btc/ and reflects figures at the time of writing.)

ETH/USD Key Levels and Price Action:

Source:https://www.tradingview.com/x/DDW2N5DI/

Ethereum has seen a major reversal from its $2,079 low, now up 30% from that level. It is currently retesting a key resistance level at $2,865, alongside the CPR level. If ETH can flip these into support, it could be the first sign of sustained bullish momentum.

ETH Total ETF Flows for 3 Feb: $ (data not available)

(ETF flow data is sourced from https://farside.co.uk/eth/ and reflects figures at the time of writing.)

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*All prices are denominated in USD unless stated otherwise*

Written by Alexandar Artis

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No Advice Warning

The information in this newsletter is general only. It should not be taken as constituting professional advice from the author - Stormrake PTY LTD.

Disclaimer

The Trade Wars have Begun

Tue, 04 Feb 2025 15:24:20 +1100

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The trade wars have gotten off to a rough start for all markets. Following the official imposition of US tariffs on Canada, Mexico, and China, Canadian Prime Minister Justin Trudeau has responded with a retaliatory 25% tariff on $155 billion worth of US goods. In turn, President Trump has threatened to escalate tariffs on Canada in response to Trudeau’s move. We now eagerly await President Xi’s reaction, which could have significant market implications.

The threat of tariffs was no surprise—after all, it was a key selling point of Trump’s campaign to ‘save’ the US economy. However, now that the reality is here, markets have reacted negatively.

Traditional Markets Struggle to Recover

Just a week after the DeepSeek AI-driven market crash, markets have barely had a chance to breathe. Traditional indices like the Nasdaq and S&P 500 continue to suffer, with Nasdaq futures opening 600 points down and S&P 500 futures dropping 120 points this morning. Meanwhile, the VIX—an index that measures market volatility—is set to open over 10% higher than its previous close. Both indices are now trading lower than they were in the immediate aftermath of last week’s crash.

Crypto Market Hit Hard as Bitcoin Falls Below $100K

This turmoil has bled into the crypto market as well. Bitcoin has now slipped back under $100K, currently trading at $96.7K—lower than it was during last week’s crash. Ethereum has dropped below $3,000, and Solana has once again fallen under $200.

Since Bitcoin’s high of $106K on Friday, it has retraced 8%, while Ethereum is down 17% and Solana 19%. All the hard work Bitcoin did to reclaim $100K and set up for a retest of all-time highs has been wiped out in just one weekend. This volatility serves as a reminder: having a clear long-term investment strategy is essential. Short-term swings can shake out weak hands, but those with long-term conviction will survive and ultimately prosper.

What Does This Trade War Mean for Crypto?

In the short term, expect more volatility. Altcoins have been decimated, and this is the period where conviction matters most. Investors with a strong belief in their chosen projects will see these 20%+ drops as opportunities to dollar-cost average. Even the strongest altcoins, like Sui and Ondo, have plunged 25% in recent days, yet those who remain confident in these projects are likely to take advantage of these discounts and reap the rewards when the market turns around.

Long term, nothing changes. Despite the current correlation with traditional markets, Bitcoin and crypto remain in a bull run, and a crypto-friendly US administration will continue to be a tailwind. These trade wars may create short-term fear, but they do not alter the bigger picture.

There are still major bullish catalysts ahead this year:

Interest rate cuts
The US government’s digital asset stockpile, which will see the US government begin accumulating Bitcoin (and potentially other cryptocurrencies) in its reserves

Last week, we saw the head of the Czech National Bank propose a plan to buy Bitcoin with their reserves. The play here is obvious: take advantage of the market-wide discounts, pick up Bitcoin, and then sit back and relax. Ignore the short-term noise—conviction is how you win in Bitcoin.

Stormrake Spotlight: Ethereum (ETH) ($2,842)

Source:https://www.tradingview.com/x/MO1ottgT/

Since the last morning note, Ethereum has fallen 15%, breaking through the accumulation zone after setting up for a breakout. ETH is now testing a major support level that has historically acted as a key area for reversals.

This level should hold as strong support, making it a potential point for Ethereum to stabilise and reverse. However, if macroeconomic conditions remain bearish and continue to weigh on markets, ETH could fall further.

BTC/USD Key Levels and Price Action:

Source:https://www.tradingview.com/x/GmqY59ru/

Bitcoin is now testing key support at $95.7K, as the trade war intensifies. The selling pressure has been relentless, with BTC slicing through previous support levels with ease. If $95.7K fails to hold, Bitcoin is likely to retest a major prior support level at $92.5K.

BTC Total ETF Flows for 2 Feb: $ (data not available)

(ETF flow data is sourced from https://farside.co.uk/btc/ and reflects figures at the time of writing.)

ETH/USD Key Levels and Price Action:

Source:https://www.tradingview.com/x/ZMbnSgZx/

On the short-term time frame, Ethereum continues to break below key levels with little support. ETH has now fallen below $2,865, where buyers previously stepped in. However, buying momentum seems to have dried up as selling pressure persists.

If ETH does not reverse soon, the next major downside target is $2,555.

ETH Total ETF Flows for 2 Feb: $ (data not available)

(ETF flow data is sourced from https://farside.co.uk/eth/ and reflects figures at the time of writing.)

To receive the Morning Note in your inbox, subscribe here: https://stormrake.substack.com/

*All prices are denominated in USD unless stated otherwise*

Written by Alexandar Artis

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No Advice Warning

The information in this newsletter is general only. It should not be taken as constituting professional advice from the author - Stormrake PTY LTD.

Disclaimer

Crypto Starts February on the Back Foot as Markets React to Tariffs

Sat, 01 Feb 2025 12:34:43 +1100

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Despite January closing on a positive note and proving to be a strong month for Bitcoin, the past 24 hours have delivered poor price action following what initially appeared to be a promising start to February. In the last six hours alone, Bitcoin has dropped over 4%, falling back to just above $102K.

Some are attributing this sudden correction to the White House’s recent confirmation that 25% tariffs on Canada and Mexico, along with 10% tariffs on China, will go into effect on February 1. Many economic analysts remain highly sceptical about the tariffs, arguing that they will provide no benefit and actually hinder everyday Americans. Since the confirmation was made in the early hours of the morning, all major markets have declined. Both the S&P 500 and Nasdaq have fallen, triggering a domino effect across the crypto markets, with Bitcoin and most altcoins following suit. Even traditional ‘safe havens’ like gold have taken a hit, while the US dollar has strengthened, indicating broader risk-off sentiment.

Despite the broader bearish trend in crypto, two major projects have stood out—not only outperforming Bitcoin and most other cryptocurrencies but also managing to close the day with solid gains. These are Ethereum (ETH) and Sonic (S). Over the last two days, Ethereum has outperformed Bitcoin by nearly 8%, providing the first glimmer of hope for ETH bulls. Meanwhile, despite weak price action following the Fantom-to-Sonic migration, Sonic has begun to show some positive signs, gaining 30% in just two days.

That being said, Bitcoin remains the key driver of the market, still locked in the $100K–$109.9K range that it has occupied for the past couple of weeks. Will February finally break this prolonged consolidation, or is it time for Ethereum to take the lead?

Stormrake Spotlight: Ethereum (ETH) ($3,301)

Source:https://www.tradingview.com/x/zoFBOua7/

Ethereum has shown exceptional strength in recent days, rewarding those who accumulated ETH within the highlighted support zone. Currently trading at $3,300, ETH is up 10% from the bottom of the range, after reaching a high of $3,437 yesterday. This marked a higher high based on the wick high.

However, ETH’s momentum has slightly stalled following the broader market reaction to the tariff news. That said, the bullish structure remains intact. If ETH can clear the 55 EMA, this should reaffirm the uptrend and lead to further gains.

BTC/USD Key Levels and Price Action:

Source:https://www.tradingview.com/x/QCZHR9pC/

Bitcoin looked poised to establish a solid base above $104K and attempt a move toward its all-time highs. However, this did not play out, as BTC sharply fell below this key level, flipping all moving averages and shifting momentum back in favour of the bears.

Despite this setback, the overall bullish structure remains intact—for now. As long as this low holds, another attempt to reclaim $104K remains possible. However, if it fails, BTC could quickly retest $100K.

BTC Total ETF Flows for 31 Jan: $ - 51.0 million

(ETF flow data is sourced from https://farside.co.uk/btc/ and reflects figures at the time of writing.)

ETH/USD Key Levels and Price Action:

Source:https://www.tradingview.com/x/em8dGwfc/

As noted earlier, Ethereum has been outperforming Bitcoin in the past couple of days, and this strength is evident in the price action. ETH has maintained higher highs and higher lows, keeping its bullish momentum intact despite the current pullback.

The key level to watch is $3,370—if the 55 EMA holds as support, ETH is likely to retest this level and continue its uptrend.

ETH Total ETF Flows for 31 Jan: $ - 31.9 million

(ETF flow data is sourced from https://farside.co.uk/eth/ and reflects figures at the time of writing.)

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*All prices are denominated in USD unless stated otherwise*

Written by Alexandar Artis

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No Advice Warning

The information in this newsletter is general only. It should not be taken as constituting professional advice from the author - Stormrake PTY LTD.