Friday, Dec 1, 2023

BTC at YTD high, oil price drama, crazy rates expectations, trading data philosophy

“But here's some advice, boy. Don't put your trust in revolutions. They always come around again. That's why they're called revolutions.” – Terry Pratchett ||

Hi all! Well, hello December… I personally don’t feel quite ready for you yet, but you’re here, so I’ll have to catch up fast.

You’re reading the daily premium Crypto is Macro Now newsletter, where I look at the growing overlap between the crypto and macro landscapes. There’s also usually some market commentary, but NOTHING I say is investment advice. For full disclosure, I have held the same long positions in BTC and ETH for years, and have no intention to either buy more or sell in the near future.

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IN THIS NEWSLETTER:

• Bitcoin reaches its year-to-date high

• Oil price drama

• What on earth is happening to rates expectations?

• Trading data - who should have access?

WHAT I’M WATCHING:

Bitcoin reaches its year-to-date high

When I logged on this morning, my screen said that BTC was up at $38,800, which made me rub my eyes and go and get more coffee.

It turned out that I wasn’t seeing things. I then assumed it must be an options expiry-driven move which would swiftly correct, but as I type this several hours later, BTC is still above $38k.

(chart via TradingView)

Of course, this shouldn’t be surprising – tailwinds have been gathering strength all year, especially in recent months as spot ETF expectations build, the Binance uncertainty is resolved, and 2024’s accelerated money printing becomes more inevitable. Plus, geopolitically, disconcerting things are happening.

But, BTC has often jumped and then corrected as there is still obviously a fair amount of selling pressure out there. There’s concern about the Mt. Gox distribution and the eventual sale of the US government’s stash, and the “safe” yield in money market funds is still a magnet. In other words, I don’t think we’re in “up only” territory just yet. It would be fun to be wrong, though.

Oil price drama

There’s some consolation today in knowing that crypto traders are probably less confused than oil traders.

Yesterday, OPEC+ announced further production cuts of 900,000 barrels a day in the first quarter of 2024, on top of the 1.3 million barrel a day cuts by Saudi Arabia and Russia that are already in place and are being extended.