The Range- Flagship Vault Update Week 24

Over the past seven days, the Portfolio Vault's share price has decreased from $76.62 to $69.41, an 11.27% decrease. Regarding BTC and ETH, the Flagship portfolio vault underperformed BTC by 6.31% and underperformed ETH by 2.17%.

Portfolio Vault Assets update

Bitcoin

Bitcoin is down 4.88% this week. Inflows into the nine exchange-traded funds (ETFs) tied to Bitcoin have fallen off from its previous week's high. Last week, we saw over $1.5 billion in inflows, while this week, we have seen over $150 million in outflows. While this had 10x fewer outflows, most of the inflows occurred at the top of the range.

Regarding technical indicators, Bitcoin has rejected the range high and lost the daily trend. As is with ranges, we will continue to range until we all collectively lose our minds or until one side of the range breaks. Until the range breaks, we expect most alts to underperform, with certain alts beating expectations.

The Open Network

Over the past week, TON has seen a 4.75% increase. TON has recently flipped Ethereum in Daily Active Addresses. TON surpassed Ethereum in DAA; in June, TON surpassed ETH on 10 out of the 11 days. On June 3, TON set a record with 568,300 DAAs, which Ethereum hasn’t reached since September 13, 2023.

TON has been one of the strongest alts in the space and one of the strongest alt blockchains. TON has again broken its all-time high, and millions of users flow into the TON ecosystem. The summer of TON might be starting before our very eyes.

Pendle Finance

Pendle has decreased by 14.3% over the last seven days, continuing its long-term and short-term trends. After the recent ETH ETF announcement, the Total Value Locked (TVL) has reclaimed 6 billion dollars. With the ETH ETF, there is a strong demand for Ethereum-based tokens, and Pendle has shown to be one of the strongest ones.

Pendle has remained in its range but is exhibiting weakness. It failed to make a new high and has not made a new low in market structure for now. If Pendle can make a higher low, it would show that we are in for a volatility crunch, with one side needed to break.

Solana

Solana has decreased by 11.91% in the last seven days. With Solana overtaking Ethereum on DEX volumes, most on-chain participants have flipped over to Solana because of the cheap fees.

The chart for Solana looks good in terms of a high time frame, as it has retraced a large part of its previous move and is looking to build support at the last consolidation phase.

Fetch

Fetch is down 22.36% in the last seven days. It is currently undergoing a merger with SingularityNet and Ocean Protocol. The three AI platforms will complete the token merger on June 13, and FET will be renamed ASI two days before.

Fetch is close to losing its range low, but as it's close to losing it, the daily 200 moving average is there, and Fetch is showing some strength, with it being one of the best performers in the recent bounce.

Bittensor

Bittensor has been down 17.62% in the last seven days. Bittensor has updated the number of subnets on the Bittensor Network, upping it from 36 to 38.

While Bittensor has been underperforming these last few weeks, from a fundamental perspective, it is one of the strongest projects out there. It captures every sub-AI sector, as these can be built on the Bittensor Network.

Ondo

Ondo Finance is down 5.66% in the last seven days. Ondo is a DeFi protocol that aims to provide institutional-grade financial products on the blockchain, including tokens backed by U.S. Treasuries. It has been supported by prominent figures in the financial industry, including Larry Fink, the CEO of BlackRock, one of the world's largest asset management firms.

Ondo's technical indicators are also bullish. It's one of the few adults that has held its daily trend. With the ETH ETF, the tokenization narrative can catch a bid with Ondo being the lead RWA narrative and backed by Larry Fink. Ondo can be a top performer.

Pyth

Pyth Network is down 21.31% in the last seven days. With new applications being launched daily, more and more are picking Pyth over Chainlink as an Oracle provider. This has caused the gap in market cap to diminish. There is speculation that Pyth Stakers will also receive numerous airdrops.

Pyth had a significant run-up and retraced the move. It is now one of the weakest alts, as there was a billion-dollar unlock. As a project with a low float and high FDV, it completely depends on the next Bitcoin move. If Bitcoin and Solana trade higher, Pyth will follow.

Stacks

Stacks is down 2.78% in the last seven days. The Nakamoto upgrade has been delayed once again, as it requires an additional eight weeks of development time.

Stacks is the biggest BTC beta. It has reclaimed the daily trend and is consolidating at previous support. If BTC can move up and break out of its current range, we can see Stacks following, as it's the biggest BTC beta.

Indicator list

Forex Markets

The Forex market is a proxy for risk on or off the environment. EUR/USD is looking strong, and the Forex market looks like a neutral/ risk environment. The dollar is looking neutral. It trades above 100 and is testing the 200-day MA, a neutral and potential risk-on scenario.

DeFi Stablecoin TVL.

When the Total Value Locked (TVL) exceeds the market capitalization, it indicates a risk-on environment. Conversely, if the TVL falls below the market cap, it suggests a risk-off scenario where investors are more cautious. Recently, TVL has been trending upward, but is stagnating. Thus indicating a neutral environment.

Relative Strength Index

The relative strength index (RSI) is a momentum indicator that measures the speed and magnitude of an asset's recent price changes. When the RSI is above 50 on either daily or weekly charts, it signals a risk-on environment. Conversely, an RSI below 50 on these timeframes suggests a risk-off atmosphere. BTC has now lost the 50 on the daily level, indicating ,more ranging

Trends

We utilise the 12, 21, and 36 Exponential Moving Averages (EMA), precise tools for market analysis, to determine the daily and weekly trends. A move below these EMAs on the daily chart will indicate a shift towards a risk-off environment, signalling caution among investors. The market shows signs of stagnation but has yet to lose the daily trend, suggesting a steady state without clear indications of a downturn. When the market reclaims its position above these EMAs on the daily timeframe, it will be considered a sign of transitioning into a risk-on environment. We have lost the daily trend, indicating more range and chop.

Bitcoin Dominance

Bitcoin Dominance (BTC.D) doesn't directly indicate a risk-on or risk-off environment. Still, deciding our allocation strategy between Bitcoin and the rest of our portfolio is crucial. An upward trend in BTC.D suggests an increased allocation towards Bitcoin, while a downward trend signals a shift in preference towards investing more in blockchains and decentralized applications (dApps). Currently, we're on the lookout for an upward move. This could be a significant move up for BTC that will lead to ALTS underperforming.

ETF Inflows

Reviewing ETF inflows helps us understand the money movements of institutional investors. The dynamics of spot Bitcoin ETFs have recently displayed notable volatility in their inflow patterns. This week, inflows have been negative.

Total Market Caps

When analyzing market cap indicators to gauge the overall sentiment in the crypto market, we consider three different aspects. The first indicator, the total market cap of the cryptocurrency sector, hasn't reached an all-time high but is showing neutral signs.

The second market cap indicator, which excludes Bitcoin, appears weaker than the first and faces resistance. This situation presents a neutral to risk-off sentiment for altcoins while still bullish for Bitcoin, suggesting that Bitcoin might be a safer bet than other cryptocurrencies in the current market condition.

The third indicator excludes Bitcoin and Ethereum from the total market cap, revealing an even more bearish outlook. This hints at a potential increase in bearish sentiment across altcoins, except Bitcoin, which remains relatively bullish.

Liquidity

Global liquidity trends serve as a barometer for market sentiment, with an upward trend being synonymous with a risk-on environment. This suggests investors are more willing to take on risk, buoyed by the availability of capital. Conversely, a downward trend in global liquidity marks a shift towards a risk-off environment, indicating a more cautious approach by investors as capital becomes scarcer.

Equally significant is the trend in US liquidity, which mirrors the global pattern. A rise in US liquidity reflects a risk-on sentiment within the country, indicating investor confidence and a willingness to explore riskier assets. Conversely, a decrease in US liquidity signals a risk-off mood, where there's a tendency to avoid risk, favoring stability and safer investments. Understanding these trends is vital for investors, as it can guide their investment strategies and decisions.

Both global and US liquidity have started to show upward trends, suggesting a more risk-on environment in markets. This indicates that globally and US investors could have a larger risk appetite. But it is summer and can be seen as more of a ranging environment for risk-on assets.

Brent Crude Oil

Brent crude oil prices impact risk assets significantly. When oil prices rise, the cost of goods and transportation increases, leading to higher inflation. This often results in central banks raising interest rates to combat inflation, making borrowing more expensive and reducing investment in risk assets like stocks. Conversely, when oil prices fall, inflation pressures ease, potentially leading to lower interest rates, cheaper borrowing costs, and increased investment in risk assets. We are now seeing that oil is currently trending down.

Risk profile

We have decided to remain ultra-bullish on Bitcoin despite seeing a loss of trends and a more bearish environment. We are still in a bull market and are already completely deployed at better prices. Consequently, we have decided to focus on better assets and have removed Pyth from the portfolio. As such, the new vault allocations are:

Until next week,

Flagship’s Captain team