Monday, Oct 2, 2023

why are crypto markets moving up?, the longer-term impact of the no-shutdown, two economic risk factors

“It is what you don't expect... that most needs looking for.” – Neal Stephenson ||

Hi everyone, happy Monday, and welcome to October! Also welcome to the last quarter of the year, which always goes by soooo 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!

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IN THIS NEWSLETTER:

• A strong start to Q4, and why it matters for more than price

• What the shutdown save could mean for markets longer term

• Debt delinquencies

• The President is not helping in the fight against inflation

WHAT I’M WATCHING:

A strong start to Q4

True to form, crypto markets are starting off the last quarter of the year with, um, enthusiasm. Late last night European time, BTC jumped over 2% in the space of just a few minutes, and as I write, it is up more than 4% over the past 24 hours.

(chart via TradingView)

Why it matters:

October is typically a strong month for bitcoin, earning it the term “Uptober”. And while we know that patterns don’t necessarily repeat (after all, this past September turned out to be positive, breaking a six-year trend), they are comforting.

The slope of yesterday’s sharp price jump suggests that it could have been due to some short-covering – “natural” spot buying tends to have a gentler slope as traders aim to minimize the market impact of their orders. Well, whaddya know, that gentle slope is pretty much what we have been seeing over the past few days: a steady-ish trend upward, suggesting that new interest is entering the market.

(chart via TradingView)