AI/HPC Miner Basket a Good Risk/Reward Ahead of NVDA Earnings
Government Selling Seems to be Complete
Last week, we highlighted the negative seasonality from mid-August through September but emphasized that macro trends and identifiable crypto-specific factors should take precedence in assessing risk.
Since last week’s CPI print, conditions have been favorable for crypto – yields and the DXY have fallen in a non-recessionary manner (more Goldilocks than risk-off), and rate-sensitive assets like IWM and RSP have rallied.
Stablecoin inflows have also surged over the past couple of weeks – normally a very bullish sign for the wider crypto market.
Yet, BTC has underperformed, lacking the upside beta we would typically expect given such a conducive macro setup.
We attribute much of this underperformance to the selling of 10k Silk Road BTC, which was transferred to Coinbase Prime last Wednesday. We shared the chart below in our Crypto Comments video on Tuesday. This displays an apparent disconnect in performance during US market hours vs the rest of the world, starting with the transfer of the Silk Road coins to Coinbase Prime last Wednesday. To us, this suggests that this supply overhang has been a key factor contributing to the capped upside in B...Reports you may have missed
MACRO DATA POINTS TO A SOFT LANDING The global deleveraging event last week was driven by weakening economic expectations and rising fears of a potential policy error by the Federal Reserve. At the height of this uncertainty, the market priced in a 50 bps cut for September, as recession risks took center stage. However, in just a few days, the narrative has shifted. The market is now leaning back towards...
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Shifting Election Odds Erases “Trump Premium,” but it Remains Difficult to Be Bearish Amid Falling Rates and Dollar
IDEAL FOMC OUTCOME This week's events have been a reminder that while macro factors can align favorably, idiosyncratic elements can sometimes complicate the picture. On Wednesday, the Federal Reserve decided to hold interest rates steady until September. Notably, the FOMC statement emphasized the Fed's dual mandate, a significant shift from previous communications. Fed Chair Jerome Powell expressed a dovish stance, indicating a potential openness to rate cuts in September, contingent...
How the US Could Adopt BTC as a Strategic Reserve Asset, Look for ETH to Bottom Within Next Few Trading Days
POLITICAL PREDICTION MARKETS PROVIDE PARTIAL RATIONALE FOR PAUSE IN RALLY We see the recent pause in the July rally driven by two factors:General Degrossing Across All Asset Markets: The past couple of days have seen degrossing across all asset markets, including the crypto markets. This is less crypto-specific and more of a function of the market rotating out of strategies (like the long MAG 7) that worked in the first...
