SignalPlus Macro Research Report (20231107): The crypto market has net inflows for 6 consecutive weeks

The traditional 60/40 portfolio experienced its strongest rebound in more than a year last week (up 4%), but a whopping $112 billion in Treasury supply and 15 investment-grade corporate bond issuances weighed on yields. Pressure, yields rose about 9 basis points yesterday and bond prices fell back.

As issuers are eager to lock in lower financing rates in the medium term, $24 billion of new investment grade bond supply appeared in the market yesterday, followed by $48 billion of 3-year U.S. bonds, $40 billion of 10-year U.S. bonds and $24 billion of U.S. bonds. The supply of 30-year U.S. Treasury bonds will gradually hit the market from Tuesday to Thursday. Hedge funds appear to be trapped in record short positions in bond futures at a time when the Federal Reserve may be preparing to change policy direction, a situation that undoubtedly contributed to last weeks squeeze rally in bonds.

In terms of economic data, the October Senior Loan Officers Survey (SLOOS) showed that credit standards continued to tighten and demand for commercial and industrial loans was weak. Banks continued to tighten lending standards and lower risk tolerances citing the worsening economic outlook, but the situation was relatively weak. There has been a slight improvement from the worst levels seen at the start of the year; easing financial conditions should help free up some liquidity in the coming quarters, supporting continued confidence in a soft landing.

After several days of sharp gains, the stock market took a breather and entered a state of consolidation. The decline in fixed income volatility also helped support stock prices; 80% of the companies in the SP 500 index have released financial reports, and the overall performance is good. However, due to Caterpillar When the backlog of orders for the leaders declines, the market outlook is generally lowered. In the short term, the market may still be dominated by contrarian positions and technical aspects, and short sellers may need to wait patiently for a while.

In terms of cryptocurrencies, prices are still supported. Listed cryptocurrency-related products had an inflow of $261 million last week, net inflows for six consecutive weeks, most of which went to BTC; the prices of major currencies are relatively stable, and trading activities are concentrated in Altcoins (AVAX + 4%, Aptos + 9%, Aave + 11%, dYdX + 5%, Cardano + 5%, Ton + 6%, Chainlink + 8% over the past 24 hours); although spot prices have remained largely stable over the past 2.5 weeks , but as the demand for upside protection remains strong, short-term gamma remains relatively expensive.

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