The Rollercoaster Ride Continues
Weekly Recap
The global crypto market continues to exhibit a range-bound choppiness, waxing and waning on the latest headlines. We saw $ETH and $BTC start the week above the $43k level after benefitting immensely from Russian sanctions and the narratives surrounding them.
Since then, markets have retreated as commodity prices skyrocket – oil hit $130 per barrel, wheat prices reached a 14-year high, and a metal exchange had to roll back transactions and limit trading because nickel prices were getting out of hand.
Such price action had many in traditional markets beating the “stagflation” drum, thus causing equities and cryptoassets to flounder.
Bitcoin caught a bid briefly on Tuesday evening following the leak of President Biden’s Executive Order on crypto, which had a surprisingly optimistic tone (more on this below) but is once again finding it to be a challenge to remain above the $40k level.
This choppiness is directly in line with what we had forecasted for the first half of this year in our Annual Outlook, and presently, few signs are pointing to any imminent breakout from this pattern.
Reports you may have missed
BTC DECOUPLING FROM EQUITIES Over the past two weeks, BTC has begun to decouple from other risk assets. While the broader macro environment experienced choppy conditions from November 12th through yesterday, BTC has appeared indifferent to fluctuations in risk appetite, continuing its upward momentum and approaching the $100K milestone. A chart of BTC correlations highlights this decoupling, with sharp declines in its correlation to the QQQ, SPX, and IWM. The...
Market Lacks Convincing Signs of Market Froth, Major Demand Side Catalyst for CORE (Core Strategy Rebalance)
FROTH OR REPRICING? A heated debate is unfolding among crypto investors: have we just hit a local top, or will the breakout after eight months of consolidation continue higher through year-end? The crypto market has surged rapidly, as we anticipated, but the key question remains—can this rally sustain itself, or is it nearing exhaustion? Anecdotally, we are seeing renewed interest in crypto from casual observers. Friends and family are once...
TRUMP MAINTAINS A SLIGHT EDGE, BUT IT’S ESSENTIALLY A TOSSUP Well, it's here, folks – the moment that markets have been building up towards since January—the general election to decide the next President of the United States. As our clients know, we have been closely tracking polling and prediction market trends over the past several months, and these have served as a key input in our recommendations. Odds for both...
BTC ETFS SEE MASSIVE INFLOWS: IS CRYPTO NATIVE CAPITAL SIDELINED? BTC ETFs saw over $2.2 billion in net inflows across all spot ETFs from Monday through Wednesday of this week—the largest three-day sum of inflows since the products launched in January—bringing the five-day moving average to north of $500 million. This is certainly impressive and speaks to the explosive breakout we have seen this week. Source: Farside Investors, Fundstrat We've...
