Green day, then red day, now green day. Investors are oscillating between optimism and pessimism, with regards to earnings, the economy, the virus and, in the near term, jobs data due today in the US. The S&P, the Nasdaq and Dow all rose slightly, yesterday on the session. Yields jumped back up, from the 1.15% level to now 1.23%. Gold remains constrained at just $1,800.
I randomly checked the money supply and the velocity of M2 money, this morning, and the picture it paints reminded me of why I’m happy holding real and scarce assets -real estate, gold and crypto. There’s so much being pumped in the system, but the movement of said money (and so the real activity/economy it represents) is depressing.
On that note, and as hinted at yesterday in this very briefing, BTC is actually on the way back up after what looks to be just a quick correction. Prices rose over 3%, currently at $41,000.
While the BTC dominance rose slightly, alts have broadly matched the advance. Some coins boldly outperformed, I’m thinking of THETA and AAVE up more than 10%, but also UNI, GRT and SOL, up between 4-8%.
The dynamic is rather clear, the Ethereum London upgrade has been the main narrative for the past few days, supporting ETH and the layer-2 solutions with it. The hard fork is now live and successful, bolstering the DeFi space. Surprisingly, MATIC didn’t gain much, rising just 1%.
Two charts caught my attention this morning, with regards to onchain data. One show’s the growth in entities on the bitcoin networks and, believe it or not, it’s actually reaching new highs, which I find just so very supportive, regardless of price.
The second one, looks at the ratio of long-term versus short-term holders; the spread between the two types seems to be an indicator of long-term upside and this spread is currently widening. I’ll let you put two and two together.
Away from analytics, two pieces of news came through which I think are worth noting: JP Morgan officially launched an in-house bitcoin fund offered to its wealthy clients. As it’s often the case, the news might seem to be limited to only certain people and that’s true, but it’s yet another step towards more investment vehicles into the crypto space. On that very note, the second news is Invesco filing with the SEC for a Bitcoin strategy ETF.
More and more participants are coming in. Pay attention.
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