LDO Risk/Reward Looks Good Here, Immediate-term Macro Picture Still Uncertain (Core Strategy Rebalance)

Jun 21, 2024 • 6 Min Read

Flows and Sentiment Still Subdued

Last week, we received a better-than-expected CPI print, but the DXY continued to move higher due to global weakness and a hawkish Fed. We discussed the risks appearing in the metrics we use to gauge sentiment and flows. The overall lack of follow-through in the crypto market was evident.

Volumes, net ETP flows, the Coinbase discount, stablecoin market cap trend, and search interest for key crypto-related words all suggested that the market was ripe for a pullback, particularly among altcoins. As a result, we moved a portion of our altcoin allocation to stablecoins on Friday.

A week later, conditions remain consistent with what we observed last week. BTC, ETH, and SOL are still trading at a discount on Coinbase relative to Binance.

The chart in this report is only accessible to members

There remains a lack of stablecoin inflows, signaling a lack of capital desiring to enter the crypto ecosystem.

The chart in this report is only accessible to members

Bitcoin ETFs have also continued to see net outflows, with the 5-day moving average nearing year-to-date lows.

The chart in this report is only accessible to members
To be clear, on a longer timeframe, we still view dollar liquidity as being in an expansionary part of the liquidity cycle, meaning we are still within a larger bull market. However, tactically speaking, until we see DXY weakness and/or globa...

Unlock this article with a FREE 30-Day Trial!

An FSI Pro, or FSI Crypto subscription is required in order to access this content.

*Free trial available only on a monthly plan

Reports you may have missed

Sign in to read the report!

We have detected you are an active member!

Ray: 173aaf-da1bbc-1f54b9-040222-4df555