Trading Weekly: 4th November 2024

Each week, we bring you our concise overview of key global economic events, market data and significant developments in traditional finance and digital assets set to shape the week ahead.

Summary

• De-risking: pre-election pull back in BTC
• ETF inflows take a breather with decent consolidation and support at $67,000
• The next $10,000 price movement hangs in the balance and so expect whippy trading on election night.
• Volatility is on high alert in all asset markets as price action will be dominated by politics.

Crypto:

• The theme is de-risking with uncertainty making many take profit on what has been a great run.
• Bitcoin retreats from $73,624 to sit on key $67,000 support. This retreat is on a combination of profit taking, modest ETF outflows and political anxiety. Frothy pull backs can be healthy as they remove a lot of the hot air, allow consolidation and a more mature mounting of $73,000-75,000 channel.
• A Trump win could see a swift spike to $80,000-$90,000.? A Harris victory could test $54,000 in a heartbeat as her crypto resolve is seen to be milder than her opponent’s.?
• Talking their own book, the Bitcoin Policy Institute published “Digital Gold: Evaluating a Strategic Bitcoin Reserve for the United States”.

Backdrop:

Roll up, roll up, it’s show time!

• The US presidential election and the FOMC are primetime. The election will be a high wire walk; the FOMC on the 7th is expected to cut 25bp, with in-line PCE & ECI, weak ISM, sub-par Beige Book and weather-battered non-farms and disappointing downward revisions all adding to the narrative.? Powell is likely to be dovish in his comments. There’s a slew of other policy meetings from the Bank of England, Sweden, Poland, Malaysia, Pakistan, Australia, Brazil and Peru.
• The Chinese National People’s Congress Standing Committee meet. Last week’s PMI’s were encouraging, but the market will demand more stimulus to buttress the economy, with yuan10trn to alleviate debt and to support housing expected.

On the radar:

• 05 Nov US election night; if the polls are right and it’s too close to call then the result may be days. ?
• Volatility bets on the VIX see max open interest on the 35call strike.? The MOVE has topped 130 amid anxiety.? ? Investors boosted their net USD longs for the 4th week in the longest streak in 6 months.
• US ISM Services will help to decipher the poor ISM, Beige Book and lumpy downward revision to payrolls.
• Policy Meetings galore: The FOMC is expected to cut 25bp on 07 Nov.? Expect a dovish Powell. The Bank of England is slated to cut 25bp on 07 Nov. The BOE will also release fresh growth and inflation forecasts. The Reserve Bank of Australia is expected to be unchanged at 4.35%; prices are in the 2%-3% target band thanks to government rebates.

Disclaimer

Zodia Markets (UK) Limited (No. 13360649) is registered with the United Kingdom Financial Conduct Authority (Firm Reference 954558) under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 in respect of its activities in cryptoassets only. Registered address: 1 Basinghall Avenue, London, EC2V 5DD.

Zodia Markets (UK) Limited is also a Money Services Business registered with FinCEN in the United States, MSB Registration Number 31000244063837.

Zodia Markets (Ireland) Limited (No. 698195) is registered and supervised by the Central Bank of Ireland for Anti-Money Laundering and Countering the Financing of Terrorism purposes only (Firm Reference C453607) under the Criminal Justice Act 2010 to 2021. Registered address: 36 Dame St, Temple Bar, Dublin, Ireland, D02 EF64.

Zodia Markets (Jersey) Limited (No. 125434) is registered in Jersey and supervised by the Jersey Financial Services Commission as a Virtual Asset Services Provider and for the conduct of Investment Business (Class A), Firm Reference IB7800. Registered address: No 1 Grenville Street, St Helier JE2 4UF.

Trading Weekly Newsletter Disclaimers – Digital Assets: Trading in digital assets carries a high level of risk and may not be suitable for all investors. The value of digital assets can fluctuate significantly and may result in significant loss. You should carefully consider your investment objectives, level of experience, and risk appetite before deciding to trade in digital assets. The information provided in this Trading Weekly Newsletter is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation, or which would subject us to any registration requirement within such jurisdiction or country. The information provided in this Trading Weekly Newsletter is not intended to be, and should not be construed as, investment, financial, or other professional advice. You should consult with a financial advisor or other professional to determine what may be best for your individual needs. We do not guarantee the accuracy or completeness of any information in this Trading Weekly Newsletter. We will not be liable for any errors or omissions, or for any actions taken in reliance on the information provided. The information provided in this Trading Weekly Newsletter is subject to change without notice. We reserve the right to modify or discontinue any services provided in this Trading Weekly Newsletter without notice. By accessing and using this Trading Weekly Newsletter, you acknowledge and accept the risks and limitations associated with trading in digital assets, and agree to hold us harmless for any losses or damages resulting from your use of this Trading Weekly Newsletter or the services provided on it.