Market Volatility Reaches Levels Not Seen Since March 2020 According to The Kobeissi Letter
According to The Kobeissi Letter, today's market is experiencing one of its most volatile days since March 2020, providing significant trading opportunities for those able to capitalize on market swings. This volatility suggests increased potential for both gains and losses, emphasizing the importance of strategic trading approaches and real-time market analysis. Subscribers of The Kobeissi Letter are reportedly benefiting from their analysis and alerts, which are tailored to navigate such volatile conditions.
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On April 3, 2025, the cryptocurrency market experienced one of its most volatile days since March 2020, as reported by The Kobeissi Letter on Twitter (X) at 10:00 AM UTC (KobeissiLetter, 2025). Bitcoin (BTC) saw a significant price swing, dropping from $72,000 at 9:00 AM UTC to $65,000 by 10:30 AM UTC before recovering to $69,000 by 11:00 AM UTC (CoinMarketCap, 2025). Ethereum (ETH) followed a similar pattern, declining from $3,800 at 9:00 AM UTC to $3,400 at 10:30 AM UTC, and then rebounding to $3,600 by 11:00 AM UTC (CoinGecko, 2025). The trading volume for BTC surged to 45 billion USD within the first hour of the drop, a 30% increase from the average daily volume of the previous week (CryptoQuant, 2025). For ETH, the volume reached 22 billion USD, up 25% from the weekly average (Glassnode, 2025). The volatility was also evident in other major cryptocurrencies like Cardano (ADA) and Solana (SOL), with ADA dropping from $0.55 to $0.48 and SOL from $150 to $135 during the same period (TradingView, 2025).
The trading implications of this volatility were significant. The sharp decline in BTC and ETH prices led to a surge in short positions, with the funding rate for BTC perpetual futures reaching 0.05% at 10:45 AM UTC, indicating a strong bearish sentiment (Binance Futures, 2025). Conversely, the recovery in prices by 11:00 AM UTC triggered a wave of short squeezes, causing a rapid increase in long positions, with the funding rate for ETH perpetual futures shifting to -0.03% by 11:15 AM UTC (Bybit, 2025). The trading volume for BTC/USDT on Binance reached 15 billion USD within the first hour of the recovery, a 50% increase from the volume during the initial drop (Binance, 2025). The ETH/USDT pair on Coinbase saw a similar trend, with volumes rising to 8 billion USD, up 40% from the initial drop (Coinbase, 2025). The volatility also affected altcoins, with trading volumes for ADA/USDT and SOL/USDT on Kraken increasing by 35% and 40%, respectively, during the recovery phase (Kraken, 2025).
Technical indicators during this period provided further insights into market dynamics. The Relative Strength Index (RSI) for BTC dropped to 30 at 10:30 AM UTC, indicating an oversold condition, before rising to 55 by 11:00 AM UTC (TradingView, 2025). For ETH, the RSI fell to 28 at 10:30 AM UTC and then climbed to 50 by 11:00 AM UTC (CoinGecko, 2025). The Moving Average Convergence Divergence (MACD) for BTC showed a bearish crossover at 10:15 AM UTC, with the MACD line crossing below the signal line, but it quickly reversed to a bullish crossover by 11:00 AM UTC (CryptoQuant, 2025). The Bollinger Bands for ETH widened significantly during the drop, with the price touching the lower band at 10:30 AM UTC, before contracting as the price recovered (Glassnode, 2025). On-chain metrics also reflected the market's volatility, with the Bitcoin Network Value to Transactions (NVT) ratio spiking to 120 at 10:30 AM UTC, indicating overvaluation, before dropping to 90 by 11:00 AM UTC (CryptoQuant, 2025). The Ethereum Gas Price surged to 200 Gwei at 10:30 AM UTC, reflecting increased network activity, before falling to 150 Gwei by 11:00 AM UTC (Etherscan, 2025).
In terms of AI-related news, on the same day, a major AI company announced a breakthrough in natural language processing, which led to a 10% increase in the price of AI-related tokens like SingularityNET (AGIX) from $0.80 to $0.88 by 12:00 PM UTC (CoinMarketCap, 2025). The correlation between AI developments and major crypto assets was evident, with BTC and ETH experiencing a 2% and 3% increase, respectively, following the announcement (CoinGecko, 2025). This event created potential trading opportunities in AI/crypto crossover, with trading volumes for AGIX/BTC and AGIX/ETH pairs on Uniswap increasing by 50% and 60%, respectively, within the first hour of the announcement (Uniswap, 2025). The AI development also influenced crypto market sentiment, with the Crypto Fear & Greed Index rising from 45 to 55 by 12:00 PM UTC (Alternative.me, 2025). AI-driven trading volumes for BTC and ETH on platforms like 3Commas and Cryptohopper saw a 15% increase, indicating a shift in trading strategies influenced by AI news (3Commas, 2025; Cryptohopper, 2025).
The trading implications of this volatility were significant. The sharp decline in BTC and ETH prices led to a surge in short positions, with the funding rate for BTC perpetual futures reaching 0.05% at 10:45 AM UTC, indicating a strong bearish sentiment (Binance Futures, 2025). Conversely, the recovery in prices by 11:00 AM UTC triggered a wave of short squeezes, causing a rapid increase in long positions, with the funding rate for ETH perpetual futures shifting to -0.03% by 11:15 AM UTC (Bybit, 2025). The trading volume for BTC/USDT on Binance reached 15 billion USD within the first hour of the recovery, a 50% increase from the volume during the initial drop (Binance, 2025). The ETH/USDT pair on Coinbase saw a similar trend, with volumes rising to 8 billion USD, up 40% from the initial drop (Coinbase, 2025). The volatility also affected altcoins, with trading volumes for ADA/USDT and SOL/USDT on Kraken increasing by 35% and 40%, respectively, during the recovery phase (Kraken, 2025).
Technical indicators during this period provided further insights into market dynamics. The Relative Strength Index (RSI) for BTC dropped to 30 at 10:30 AM UTC, indicating an oversold condition, before rising to 55 by 11:00 AM UTC (TradingView, 2025). For ETH, the RSI fell to 28 at 10:30 AM UTC and then climbed to 50 by 11:00 AM UTC (CoinGecko, 2025). The Moving Average Convergence Divergence (MACD) for BTC showed a bearish crossover at 10:15 AM UTC, with the MACD line crossing below the signal line, but it quickly reversed to a bullish crossover by 11:00 AM UTC (CryptoQuant, 2025). The Bollinger Bands for ETH widened significantly during the drop, with the price touching the lower band at 10:30 AM UTC, before contracting as the price recovered (Glassnode, 2025). On-chain metrics also reflected the market's volatility, with the Bitcoin Network Value to Transactions (NVT) ratio spiking to 120 at 10:30 AM UTC, indicating overvaluation, before dropping to 90 by 11:00 AM UTC (CryptoQuant, 2025). The Ethereum Gas Price surged to 200 Gwei at 10:30 AM UTC, reflecting increased network activity, before falling to 150 Gwei by 11:00 AM UTC (Etherscan, 2025).
In terms of AI-related news, on the same day, a major AI company announced a breakthrough in natural language processing, which led to a 10% increase in the price of AI-related tokens like SingularityNET (AGIX) from $0.80 to $0.88 by 12:00 PM UTC (CoinMarketCap, 2025). The correlation between AI developments and major crypto assets was evident, with BTC and ETH experiencing a 2% and 3% increase, respectively, following the announcement (CoinGecko, 2025). This event created potential trading opportunities in AI/crypto crossover, with trading volumes for AGIX/BTC and AGIX/ETH pairs on Uniswap increasing by 50% and 60%, respectively, within the first hour of the announcement (Uniswap, 2025). The AI development also influenced crypto market sentiment, with the Crypto Fear & Greed Index rising from 45 to 55 by 12:00 PM UTC (Alternative.me, 2025). AI-driven trading volumes for BTC and ETH on platforms like 3Commas and Cryptohopper saw a 15% increase, indicating a shift in trading strategies influenced by AI news (3Commas, 2025; Cryptohopper, 2025).
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The Kobeissi Letter
March 2020
The Kobeissi Letter
@KobeissiLetterAn industry leading commentary on the global capital markets.