BTC and ETH posted a second consecutive week of gains last week, with BTC posting gains of +10% and ETH surging by nearly +18%, marking a strong continuation of recent gains, driven by a favorable regulatory outlook following the recent U.S. election. This week, BTC reached an all-time high of $93,519 on November 13, while ETH approached $3,500. As of year-to-date, BTC has soared +113%, with ETH up by around 40%. Meanwhile, Bitcoin’s market dominance increased to over 61%, a level last seen in March 2021. Digital asset investment products saw a spike in inflows, indicating continued institutional interest, particularly in spot Bitcoin ETFs like BlackRock’s iShares Bitcoin Trust, pushing the global AUM to a new high of $116bn. Total year-to-date net inflows reached $31 billion, per CoinShares’ Digital Asset Fund Flows report.
U.S. equities closed last week up, with the Nasdaq reaching a new ATH over 19,318 on Friday, while the S&P 500 reached and tested the much anticipated 6,000 mark as markets benefitted from the global optimism ignited by the outcome of the US election and the November Fed rate cut of 25bps. The S&P 500 and Nasdaq closed on Friday near 5,995 and 19,287, respectively, up +4.7% and +5.7% for the week. Meanwhile, the VIX index dropped to 14. Markets had a mixed start this week, with a push on Tuesday as inflation CPI data met expectations – Headline +2.6 and Core +3.3%, easing concerns of a stronger-than-expected rise of inflation with tariffs on China and the rest of the world looming and other inflationary pressures remaining a challenge for a potential Fed rate cut in December 2024. Current market expectations for a 25-bps cut from the Fed in December stand at 86%.
U.S. Treasury yields paused last week, amidst a volatile with yields giving up most of the gains following Trump’s election, following the Fed’s expected rate cut and lack of clear guidance. The 10-year yield reached a high of 4.48% on Nov 6 and tumbled down to 4.30% last Friday, while the 2-year yield closed at 4.26%. This week, yields rebounded, benefitting from the bond selloff driven by expectations of strong economic growth following Trump’s election, and persistent inflation reinforced by the release of in-line October’s CPI data.
Like yields, DXY gained strongly last week, closing near 104.95 on Friday, and continued rising this week, driven by positive U.S. economic sentiment post-election and in-line CPI data. The index’s increase reflects the U.S. dollar’s strength against the euro and pound especially. Currently, it hovers around 106.6, peaking at 107.6—a level last seen in November 2023. The 107 level represents near-term resistance with the 50% Fibonacci retracement, while 105.7 offers downside support.
Oil prices dipped this week, with the WTI reaching a low of $66.97 on Wednesday as the prospect of increased U.S. production under Trump, along with concerns about weaker demand in China, worsens the outlook for oil amid growing risks of an oversupplied market.
BTC and ETH are retracing today, with BTC hovering around $88,000, while U.S. equities remain steady as markets digest the latest CPI / PPI inflation and Initial jobless claims data along with this week’s earnings reports. Looking ahead, investors will eye the release of the U.S. retail sales figures and the import/export price index on Friday, along with expected comments from New York Fed President John Williams. Additionally, Alibaba’s earnings report, which is set for Friday, will be closely watched.
Client Profits
As anticipated in our last report, volatility increased leading up to the U.S. elections and the upcoming FOMC meeting, and our cash management allowed us to mitigate risk effectively.
We rebalanced the portfolio by taking double-digit profits on some short positions in AAVE and ADA and initiated long positions on some altcoins, such as TIA. Additionally, we opened short positions on other altcoins, including SUI, DOGE, BTC, ETH, and AVAX.
Currently, 60% of our assets under management (AUM) are market-exposed, with the remainder held in cash to position ourselves for a potential BTC pullback and open new long positions if prices retrace to the $78,000 or $73,000 levels.
Bitcoin’s medium-term trajectory appears closely tied to the optimism following Donald Trump’s U.S. presidential victory, which could create a more favorable environment for cryptocurrencies.
We anticipate BTC may benefit from a more accommodative financial and regulatory landscape, with a 25-bps rate cut expected in December. However, this momentum could face pressure from potential institutional selloffs as some investors look to lock in profits.
BTC
BTC posted a second consecutive week of gains last week, rising by +10% and marking a strong continuation of recent momentum, fueled by a favorable regulatory outlook following the recent U.S. election.
The rally continued this week, with BTC reaching a new all-time high of $93,519 on November 13. Year-to-date, BTC is up +108%, while BTC’s market dominance has increased to over 61%, a level last seen in March 2021. Digital asset investment products also saw a spike in inflows, indicating continued institutional interest, particularly in spot Bitcoin ETFs like BlackRock’s iShares Bitcoin Trust, pushing global AUM to a new high of $116 billion. Total year-to-date net inflows reached $31 billion, according to CoinShares’ Digital Asset Fund Flows report.
On the daily chart, it will be interesting to see if BTC can hold above the $90,000 mark in the coming days or if a pullback toward $78,000, and potentially $73,000, occurs. We maintain a positive medium-term outlook for BTC, driven by a favorableregulatory environment anticipated under Trump’s administration and the Fed’s recent rate cut cycle, which could prompt a shift toward riskier assets. Additional factors may support prices, such as the upcoming Bitcoin halving—which has historically acted as a catalyst every four years—and the early 2024 launch of the Spot BTC ETF, which has brought steady volume and institutional participation to the market.
After rounding up 2023 performance to +155%, BTC’s 2024 YTD performance is currently at +108%, while the MTD for November stands at +25%.
ETH
Like BTC, ETH posted a second consecutive week of gains, surging nearly +18%. However, the rally has paused this week: prices approached $3,500 on Tuesday but closed lower, continuing to dip on Wednesday. Year-to-date, ETH is up around 40%, with a month-to-date (MTD) performance of +27% in November.
On the daily chart, ETH has found some momentum to escape the $2,500 zone and confirmed above the $3,000 zone. Price has been consolidating slightly after last week’s surge and is currently facing a major resistance at $3,200. A break above this trendline could send the price up to the $4,000 zone. On the downside, the $3,000 and $2,800 mark serve as nearest supports.
Other markets
U.S. equities closed last week up, with the Nasdaq reaching a new ATH over 19,318 on Friday, while the S&P 500 reached and tested the much anticipated 6,000 mark as markets benefitted from the global optimism ignited by the outcome of the US election and the November Fed rate cut of 25bps. The S&P 500 and Nasdaq closed on Friday near 5,995 and 19,287, respectively, up +4.7% and +5.7% for the week. Meanwhile, the VIX index dropped to 14.
Markets had a mixed start this week, with a push on Tuesday as inflation CPI data met expectations – Headline +2.6 and Core +3.3%, easing concerns of a stronger-than-expected rise of inflation with tariffs on China and the rest of the world looming and other inflationary pressures remaining a challenge for a potential Fed rate cut in December 2024. Current market expectations for a 25-bps cut from the Fed in December stand at 86%.
On the daily chart, the S&P price benefitted from a push to the long-awaited 6,000 mark before seeing a slight pullback. As for the Nasdaq, the price broke out the wedge pattern following the tech-oriented earnings and US elections to surpass 19,000 and is currently hovering above that level.
After ending 2023 up +17% and +29.6%, S&P and Nasdaq’s MTD performances for November are currently +4.4% and +6.6% with YTD performances standing at +25% and +28.5%.
DXY
Like yields, DXY gained strongly last week, closing near 104.95 on Friday, and continued rising this week, driven by positive U.S. economic sentiment post-election and in-line CPI data. The index’s increase reflects the U.S. dollar’s strength against the euro and pound especially. Currently, it hovers around 106.6, peaking at 107.6—a level last seen in November 2023. The 107 level represents near-term resistance with the 50% Fibonacci retracement, while 105.7 offers downside support.
The outlook for DXY changed as we believe the incoming Trump presidency could fuel some momentum for the US dollar despite the continued and structural bearish pressure we expect from additional rate cuts, likely later this year and going into 2025. The Goldilocks scenario of a no-landing of the US economy could strengthen the Dollar and offset the downward pressure.
US Treasuries
U.S. Treasury yields paused last week, amidst a volatile with yields giving up most of the gains following Trump’s election, following the Fed’s expected rate cut and lack of clear guidance. The 10-year yield reached a high of 4.48% on Nov 6 and tumbled down to 4.30% last Friday, while the 2-year yield closed at 4.26%. This week, yields rebounded, benefitting from the bond selloff driven by expectations of strong economic growth following Trump’s election, and persistent inflation reinforced by the release of in-line October’s CPI data. Market expectations for a November rate cut have increased slightly, with the CME FedWatch Tool indicating an 86% probability of a 25-basis point cut, which would set the target range to 4.25- 4.50%.
The 10Y is currently trading near 4.40% while the 2Y yield is evolving near 4.26%, confirming the end of the yield curve inversion.
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