MARKETS week ahead: July 10 – 16
Last week in the news
The US equity market closed lower on Friday amid market expectations over further interest rates increase. At the same time, the crypto market ended the week modestly lower compared to the week before. Bitcoin is ending the week above $30K, while Ether is holding above support at $1.850.
Whether it is just a seasonal effect, or the US jobs market is cooling down is about to be seen during the following months. Still, published data for June show that payrolls in the US increased by 209K which is far less from the market expectation of 240K. At the same time, the level of wages was up, as average hourly earnings in June were up by 0.4% m/m, which is 4.4% increase from the same period last year. This shows a bit of a mixed picture when the jobs market is in question, which increased market expectation that FED might bring rates higher in the coming month. According to the market poll, there is currently a 92% chance for rate increase at July`s FOMC meeting.
In an interview with CNBC, Chicago FED President Austan Goolsbee noted his expectations that inflation can be brought back to target without a recession in the US. He stressed that the primary goal of the FED currently is to take inflation down to targeted 2% level with a “golden path” which does not include a recession. On the other hand, economists are convinced that such a pace of rate increases would certainly lead to at least modest recession in the coming months. Goolsbee`s recent notes are also not fully compliant with released June FOMC minutes. The Minutes revealed that some Fed officials are concerned over the possibility of a recession within next six months, followed by “moderately paced recovery”.
During the previous week a lot of market and news attention was on the statement of the BlackRock`s CEO Larry Fink, who significantly changed his view on Bitcoin. Namely, in an interview he noted that Bitcoin could “revolutionize finance”, which is a significant shift in thinking from previous extreme skepticism toward the crypto coin. Analysts are noting that the initial idea behind the creation of Bitcoin was decentralization, where the middle-institution is not necessary, in which sense, they are arguing that BlackRock is entering the crypto area with wrong reasons. Just as a reminder, BlackRock recently filed with SEC for its first BTC ETF, still pending official conclusion.
Problems for Binance exchanger continues to emerge. During the previous week, authorities in Australia demanded a copies of internal communication from both current and former employees of Binance. There is currently no official information what was the aim of these requests, or whether it is in connection to recent trials from US regulators, or raids within the EU of Binance exchanger.
Crypto market cap
The SEC issue over the question of what is and is not treated as a security in the crypto world is digested by the market, so now old issues emerge. Latest officially published job and earnings data in the US continue to send mixed signals, but due to an increase in wages in June, markets raised expectations of another rate hike in July. The sentiment has now increased to 92% for a rate increase at the FOMC meeting in July. Fed Chair Powell stressed potential two more rate increases till the end of this year, but it will take some time until monetary measures fully transmit into the economy. While economists are certain that there would be at least a modest recession, some Fed officials are stressing a possibility of no-recession. Total crypto market capitalization ended the previous week 2% lower from the week before, losing $24B in value. Daily trading volumes significantly decreased from the week before, trading around 40B on a daily basis, from $94B a week before. Total crypto market capitalization increase since the beginning of this year is 50%, where it has added a total $378B to the market cap.
Although during the previous week the market was generally oriented toward the short term correction, not all coins lost in value. Major coins were leading the drop in total market capitalization. Both Bitcoin and Ether lost more than $7B in value, leading to drop in market cap of BTC by 1.20% and ETH by 3.1% on a weekly basis. Due to issues with regulators in the EU and Australia of Binance exchanger, BNB lost $1.6B in value or 4.2%. Other coins with significant drop in value during the week in relative terms were ZCash, with a drop of 18%, DASH was down by 12%, same as NEO. Ethereum Classic lost 10% in the market cap, while Bitcoin Cash decreased its cap by more than 8%. Among coins which finished the week in green were Solana, with an increase of 19.2% in value, Polygon was up by 1.6%, Filecoin increased its cap by 6.2% and Maker managed to finish the week 11% higher from previous one. As for coins in circulation, Algorand increased its circulating coins by 2.6%, while Solana`s coins were higher in number by 0.5% w/w.
Crypto futures market
There have been some interesting developments in the crypto futures market when ETH is in question. Regardless of developments on the spot market and previous inverted futures curve, during the previous week, short term ETH futures were down by more than 3%, while longer term futures were traded up between 1.4% and 3%. This situation is not so frequently seen with ETH futures. ETH futures maturing in December this year were traded higher by 1.42% w/w, finishing the week at level of $1.935. At the same time, ETH futures maturing in December next year were traded at level $1.999 which is 3% higher from the week before. This implies that the market is perceiving some positive developments with ETH in the future period and potential that the price might return to the level of $2K during the course of the next year.
BTC short term futures were traded in line with the spot market, down by some 0.7% w/. Futures maturing in December this year ended the week at level of $31.790 or 1.7% higher from the week before. However, futures maturing in December next year were down by 0.97%, ending the week at level of $32.610.
The US equity market closed lower on Friday amid market expectations over further interest rates increase. At the same time, the crypto market ended the week modestly lower compared to the week before. Bitcoin is ending the week above $30K, while Ether is holding above support at $1.850.
Whether it is just a seasonal effect, or the US jobs market is cooling down is about to be seen during the following months. Still, published data for June show that payrolls in the US increased by 209K which is far less from the market expectation of 240K. At the same time, the level of wages was up, as average hourly earnings in June were up by 0.4% m/m, which is 4.4% increase from the same period last year. This shows a bit of a mixed picture when the jobs market is in question, which increased market expectation that FED might bring rates higher in the coming month. According to the market poll, there is currently a 92% chance for rate increase at July`s FOMC meeting.
In an interview with CNBC, Chicago FED President Austan Goolsbee noted his expectations that inflation can be brought back to target without a recession in the US. He stressed that the primary goal of the FED currently is to take inflation down to targeted 2% level with a “golden path” which does not include a recession. On the other hand, economists are convinced that such a pace of rate increases would certainly lead to at least modest recession in the coming months. Goolsbee`s recent notes are also not fully compliant with released June FOMC minutes. The Minutes revealed that some Fed officials are concerned over the possibility of a recession within next six months, followed by “moderately paced recovery”.
During the previous week a lot of market and news attention was on the statement of the BlackRock`s CEO Larry Fink, who significantly changed his view on Bitcoin. Namely, in an interview he noted that Bitcoin could “revolutionize finance”, which is a significant shift in thinking from previous extreme skepticism toward the crypto coin. Analysts are noting that the initial idea behind the creation of Bitcoin was decentralization, where the middle-institution is not necessary, in which sense, they are arguing that BlackRock is entering the crypto area with wrong reasons. Just as a reminder, BlackRock recently filed with SEC for its first BTC ETF, still pending official conclusion.
Problems for Binance exchanger continues to emerge. During the previous week, authorities in Australia demanded a copies of internal communication from both current and former employees of Binance. There is currently no official information what was the aim of these requests, or whether it is in connection to recent trials from US regulators, or raids within the EU of Binance exchanger.
Crypto market cap
The SEC issue over the question of what is and is not treated as a security in the crypto world is digested by the market, so now old issues emerge. Latest officially published job and earnings data in the US continue to send mixed signals, but due to an increase in wages in June, markets raised expectations of another rate hike in July. The sentiment has now increased to 92% for a rate increase at the FOMC meeting in July. Fed Chair Powell stressed potential two more rate increases till the end of this year, but it will take some time until monetary measures fully transmit into the economy. While economists are certain that there would be at least a modest recession, some Fed officials are stressing a possibility of no-recession. Total crypto market capitalization ended the previous week 2% lower from the week before, losing $24B in value. Daily trading volumes significantly decreased from the week before, trading around 40B on a daily basis, from $94B a week before. Total crypto market capitalization increase since the beginning of this year is 50%, where it has added a total $378B to the market cap.
Although during the previous week the market was generally oriented toward the short term correction, not all coins lost in value. Major coins were leading the drop in total market capitalization. Both Bitcoin and Ether lost more than $7B in value, leading to drop in market cap of BTC by 1.20% and ETH by 3.1% on a weekly basis. Due to issues with regulators in the EU and Australia of Binance exchanger, BNB lost $1.6B in value or 4.2%. Other coins with significant drop in value during the week in relative terms were ZCash, with a drop of 18%, DASH was down by 12%, same as NEO. Ethereum Classic lost 10% in the market cap, while Bitcoin Cash decreased its cap by more than 8%. Among coins which finished the week in green were Solana, with an increase of 19.2% in value, Polygon was up by 1.6%, Filecoin increased its cap by 6.2% and Maker managed to finish the week 11% higher from previous one. As for coins in circulation, Algorand increased its circulating coins by 2.6%, while Solana`s coins were higher in number by 0.5% w/w.
Crypto futures market
There have been some interesting developments in the crypto futures market when ETH is in question. Regardless of developments on the spot market and previous inverted futures curve, during the previous week, short term ETH futures were down by more than 3%, while longer term futures were traded up between 1.4% and 3%. This situation is not so frequently seen with ETH futures. ETH futures maturing in December this year were traded higher by 1.42% w/w, finishing the week at level of $1.935. At the same time, ETH futures maturing in December next year were traded at level $1.999 which is 3% higher from the week before. This implies that the market is perceiving some positive developments with ETH in the future period and potential that the price might return to the level of $2K during the course of the next year.
BTC short term futures were traded in line with the spot market, down by some 0.7% w/. Futures maturing in December this year ended the week at level of $31.790 or 1.7% higher from the week before. However, futures maturing in December next year were down by 0.97%, ending the week at level of $32.610.
