Flippening Watch
Inflation Eases, Markets Rip
The collective world briefly exhaled this week as inflation showed its first signs of cooling in nearly a year. On Wednesday, CPI surprised to the downside, as energy prices showed a month-over-month (MoM) decline for the first time since April.
Topline CPI was 8.5%, below the consensus forecast of 8.7%, and lower than the 9.1% figure in June. The CPI basket was unchanged MoM, as the total energy basket came in 7.6% lower than June, while food continued to climb (up 1%) and prices for all items less food and energy were 0.3% more expensive over the same period.
This downside surprise furthered a red-hot risk-on rally in both traditional and crypto markets.
Interestingly, despite all the talk about energy being the only constructive figure in the granular breakdown of the CPI basket, we have actually seen CPI less food and energy slow considerably – this being the 4th consecutive month of decline in YoY rate increases.
The market has since pivoted slightly to a slightly dovish stance following the print, skewing towards a 50-bps hike in September, compared to the 75-bps rate hike being priced in just last week.
Countdown to Mainnet Merge
In the crypto world, the big news t...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...
