ECB cuts by March, Fed by June
An easing cycle has arrived. Sneaky fast.
Dear readers,
There are times for research, and then there are times for bold predictions. As we are neither a trading service nor a prediction engine, staying away from sweeping claims is our preferred modus operandi. Regular readers are also familiar that I never hold back from calling out certain shifts in the market. With the Fed pause now about to stretch over half a year, Fed cuts are coming much sooner, and much more sneakily, than most realize. Let’s do some forecasting.
River is the Bitcoin exchange of choice for the long-term investor.
Securely buy Bitcoin at the tightest spreads in the industry, have peace of mind thanks to their 100% full-reserve cold storage custody, and enjoy zero fees on recurring orders. Need help? They have US-based phone support for all clients.
Invest in Bitcoin with confidence at River.com/TBL
Today’s charts
Bitcoin
BTC/ETH market cap ratio
Crude oil
Oil/gold ratio versus US Treasury 10-year yields
German yields
ECB policy rate pricing
Fed policy rate pricing
S&P 500
Bitcoin doing bull shit
After recent price action, how can we not start with bitcoin? The digital asset is now up 150% year to date and showing all the signs of an early bull market. Now within striking range of $50,000 and also all-time highs, bitcoin’s price is back in the range that makes most of the people who have ever bought it look like geniuses.
On this front, we must point out recent bull markets have demonstrated similar patterns—in the early days of each run, the price consolidates or chops through a region in which the price will never trade again. For example, last bull market, the price went above and below $9,000 several times. This lasted for years. Then, once the price went to $70,000 and had another one of its patented 80% drawdowns, it still bottomed around double the $9,000 level. I believe $40,000 will represent that type of scenario for bitcoin. When the current bull market takes the price over $100,000 sometime in the next year or two, the subsequent pullback will not allow people to enter at $40,000—the bottom will be higher.