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In This Issue:
The Best Research In Crypto
Bitcoin Thoughts And Analysis
Legacy Markets
Matrixport Spooks The Market
You Probably Didn’t See This Coming
The ETF Is Very Close
Crypto Market Dump! ETF To Be Rejected? Is $1M Bitcoin Still Possible? | Raoul Pal
The Best Research In Crypto
In yesterday's newsletter, I ventured into the realm of soothsaying, offering a slew of predictions for 2024. It was less crystal ball gazing and more a dash of educated guessing mixed with a sprinkle of self deprecating humor and honest criticism of past efforts at telling the future. I served up some loose advice, aimed not just at surviving but thriving in 2024. My guesses will likely be wrong.
Let's be real: I’m not sitting atop a mountain of data with an army of analysts at my beck and call, parsing through market trends to distill a potent elixir of insights. But guess who is? Ryan Selkis of Messari Crypto.
I dove headfirst into the deep end of Messari's "Crypto Thesis for 2024" and emerged with some pearls of wisdom I'm eager to share. This report isn't locked behind a paywall – it's as free as Willy.
The report addresses different facets of the crypto universe, from investment trends to the movers and shakers, from the intricacies of DeFi and CeFi to the evolving landscapes of consumer engagement and Layer-1 networks. My aim? To bring you the crème de la crème of insights, leaving no stone unturned in our quest for crypto enlightenment.
Buckle up, it’s going to be a wild ride.
If you've made it this far, I hope you enjoyed the highlights I selected from the report. And yes, I did read the entire document.
Bitcoin Thoughts And Analysis
But my pennant!!!!!
A reminder that technical analysis is merely a risk management tool, not a crystal ball.
The beauty of it? You had an easy stop loss and invalidation right below that upper "support" and lost next to nothing by playing the retest.
Either way, this classical, validated pattern failed, like many before it. Now we are effectively just looking at sideways price action again in this range.
What is more important? Bitcoin tapped the daily 50 MA on the move down, which held as support. The last time it touched this line, considered a level of mean reversion, it was October and price was around $26,000.
Legacy Markets
Stock markets are steadying after a rough start to the year, with eyes on potential interest rate cuts. Oil prices have surged due to Middle East tensions affecting supply.
U.S. equity futures are up, and Europe's Stoxx 600 gained 0.4%, driven by oil companies like TotalEnergies SE and BP Plc. The 10-year Treasury yield rose to 3.95% as bond prices fell.
Investors are waiting for U.S. non-farm payroll data for insights into economic health and rate cut possibilities. Geopolitical concerns are also high due to tensions in the Middle East.
Despite a recent dip in the Nasdaq 100 Index, market experts remain optimistic about stock market prospects, especially in the U.S. and Japan.
Brent crude is near $79 a barrel, influenced by supply issues in Libya and attacks in Iran. European and U.S. bond yields are declining. Inflation data from Europe is anticipated, and the Fed's recent minutes suggest high interest rates may persist.
In corporate news, Apple Inc. faces a potential stock decline following a rating downgrade. UK retailer Next Plc's shares rose after a profit forecast upgrade, while JD Sports Fashion Plc's stock dropped significantly due to a reduced profit forecast.
Key market events:
Eurozone S&P Global Eurozone Services PMI, Thursday
US initial jobless claims, ADP employment, Thursday
Eurozone CPI, PPI, Friday
US nonfarm payrolls/unemployment, factory orders, ISM services index, Friday
Richmond Fed President Tom Barkin — an FOMC voter in 2024 — speaks, Friday
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 rose 0.4% as of 11:06 a.m. London time
S&P 500 futures rose 0.1%
Nasdaq 100 futures rose 0.2%
Futures on the Dow Jones Industrial Average rose 0.1%
The MSCI Asia Pacific Index was little changed
The MSCI Emerging Markets Index rose 0.2%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro rose 0.3% to $1.0955
The Japanese yen fell 0.6% to 144.22 per dollar
The offshore yuan was little changed at 7.1604 per dollar
The British pound rose 0.3% to $1.2701
Cryptocurrencies
Bitcoin rose 0.5% to $43,154.2
Ether was little changed at $2,226.98
Bonds
The yield on 10-year Treasuries advanced four basis points to 3.95%
Germany’s 10-year yield advanced six basis points to 2.08%
Britain’s 10-year yield advanced five basis points to 3.69%
Commodities
Brent crude rose 0.8% to $78.88 a barrel
Spot gold rose 0.3% to $2,047.71 an ounce
Matrixport Spooks The Market
Here’s the story:
In a matter of minutes, the sentiment surrounding a Bitcoin ETF approval plunged, all because of one crypto platform's opinion piece. This abrupt change in sentiment, coupled with declines in legacy markets, triggered a cascade of long liquidations, wiping out billions in over leveraged trades.
What’s critical to emphasize about this story is that Matrixport's opinion is just that—an opinion. There is no new information supporting this prediction; it's based solely on a political hunch. Following the release of this opinion piece, a reporter at The Block ran with the opinion as if he had stumbled upon the holy grail, and there you have it—the market was set on fire.
It's important to note that all the other evidence we have gathered, such as advertisements, amendments, named APs, seed funding dates, and hints from the SEC, Coinbase, Galaxy, Reuters, etc., remains valid.
Remember yesterday’s newsletter? Opinions are like assholes, everyone has one.
While Matrixport could be right, the odds are still stacked against them, even taking into account how the market reacted. Anyways, perhaps there is more to this story? BlackRock was initially slated to begin seeding today but was delayed to the 5th. Elsewhere in conspiracy theory land, Matrixport’s Co-founder Jihan Wu supposedly has a vendetta against Bitcoin, so maybe this was his chance to strike. Lastly, should we believe anything Matrixport has to say if, a day before they released this opinion, they published an article titled ‘Bitcoin Spot ETF approval imminent’?
The reality here is that the story meant nothing and was an excuse for an overdue leverage flush. Long were paying 66% annualized to hold their positions and open interest was at record highs. That is free money for a whale that wants to get rich by shorting and triggering a cascade. The end.
You Probably Didn’t See This Coming
Did Crypto Twitter mislead you into thinking that Ethereum and Solana are diametrically opposed in every imaginable way? That's a misconception. Etherscan, established in 2015 as one of the earliest crypto projects enabled by Ethereum, has now officially acquired Solscan, the Solana equivalent of Etherscan. If you were unaware, Solscan has risen as a prominent explorer within the Solana ecosystem, serving over three million monthly users. It now joins Polygonscan within the family of Etherscan block explorers.
I believe this is a valuable opportunity to remind everyone that even Anatoly Yakovenko, the co-founder of Solana, shares a vision of Ethereum and Solana collaborating together.
The ETF Is Very Close
There's potentially a new player on the scene, and it's none other than Goldman Sachs, rumored to be acting as an authorized participant for the BlackRock and Grayscale ETFs. While this has yet to be confirmed, it appears credible, especially in light of recent developments this week, including JP Morgan and Jane Street joining the fray. In other news, Crypto Twitter experienced a momentary state of disarray when Fidelity filed their securities registration with the SEC. While these developments are positive and suggest progress in the right direction, the ultimate significance lies in the SEC's approval. Until then, certainty remains elusive.
Crypto Market Dump! ETF To Be Rejected? Is $1M Bitcoin Still Possible? | Raoul Pal
3 years ago Raoul Pal made a bold prediction that within next 5 years the price of Bitcoin will hit $1 million. What does Raoul think about it today? Let's find out. And as always, Chris Inks will provide his analysis of the crypto market.
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The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor. Nothing contained in this e-mail constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.