Morning‌‌ ‌‌Update—August 2nd—Macro and Crypto Markets

Morning‌‌ ‌‌Update—August 2nd—Macro and Crypto Markets


Last night, during Sunday trading, most equity indexes rose including the Dow, the Nasdaq and the S&P. While Friday traded mixed, with somewhat disappointing earnings, investors seem less concerned about the delta variant and more focused on positive economic growth. 

 

Yields are going down, the dollar has fallen, this is all somewhat supportive for equities. And yet, I’m wary of a pullback. At those elevated levels and with a very positive first half of the year, it seems that we’d need more strength to carry on. I’m also looking at copper futures, failing to reach new highs, and usually serving as an indicator of a healthy economy, or not.

 

In the crypto space, we had an interesting weekend. While Friday took BTC all the way above $42,000, Saturday and Sunday were more of a pullback, with BTC currently closing the session below the 40K mark, at $39,800 -back below the resistance level.

 

On that weakness, alts seized the opportunity and outperformed. A variety of coins continued to rise, bringing healthy returns while BTC disappointed. LUNA and DOT both rose 10%, GRT and KSM rose 5%. Lastly, ETH, ADA and LINK rose 1% or stayed flat but so comparatively did better than BTC falling 4%.

 

A lot of people ask me where I see prices go short-term. I’m holding and not selling, no matter what, as I have for years now, but, for short-term traders, I do think we will need maybe a deeper pullback, at least in the mid 30K’s, if not lower 30K’s again, to establish a stronger base. Also, as mentioned above, I’m looking at traditional markets where a risk-off sentiment could impact crypto.

 

Probably the most important piece of news that came through, this weekend, is the new provision, included in the US infrastructure bill, to expand the tax code’s definition of broker. Ultimately, this is done to make sure that players in the crypto industry -miners, brokers, lenders, etc. need to KYC their users. Those users can then be identified and taxed more efficiently.

 

On a more positive side, though, and either a cause or a result of the higher prices, we can see the number of active addresses on the BTC network picking up again, rising 30% since the July low. If that keeps going up, prices can regain the mid 40K’s or the 50K’s.

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Justin d'Anethan
Justin d'Anethan

Sales Manager at Diginex and EQUOS. Passionate about financial markets, long-term investments, the occasional short-term trade and disruptive technologies.


Daily Market Update
Daily Market Update

A quick market update (1-2min read). Every week day, morning in Asia, I go over major moves in macro and crypto markets, linking fundamentals to price action.

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