Setup Still Looks Promising, Investors Just Need a Little More Convincing
May 9, 2024
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Macro Setup Still Looks Good for Crypto
As discussed last week, we achieved the favorable setup we were anticipating. A combination of (1) a dovish Federal Reserve, (2) an accelerated tapering of quantitative tightening (QT), and (3) a Quarterly Refunding Announcement (QRA) that met investors' expectations contributed to a decline in rates during the first week of May, alongside a rebound in crypto assets.
However, crypto investors remain cautious, and capital remains sidelined. Recent dovishness from foreign central banks and a partial retracement of the Japanese yen rally have...