SignalPlus Macro Research Report (20230818): Pessimism spreads, BTC falls by more than $3,000 in a short time

Recently, U.S. stocks and digital currencies have undergone adjustments at the same time for a long time. From the news perspective, there are new news every day, but there is no news that can affect the trend. The author thinks that the recent adjustments are more due to the rapid rise of risk assets, which has caused the market to worry about future liquidity shortages, resulting in sell-offs. The volatility surface of the digital currency option market has also ushered in a long-lost rise, which also reflects options participants. Concerns about future liquidity. The author maintains his previous view unchanged. It is difficult for the market to generate a large-scale bull market before the interest rate hike cycle is completed.

The quiet end of summer seems to be a luxury.

U.S. Treasuries have sold off for 6 consecutive days, the 30-year yield rose to nearly 4.40%, breaking through the panic high in 2022. The last time it was close to this level was in 2010/2011.The chaos started with the weakest 20-year JGB auction ever, with a tail of 7 basis points, leading to an overall 7-10 basis point rise in the yield curve, triggering a sell-off in global fixed income markets early on.

In China, the Peoples Bank of China has been intervening in the foreign exchange market,Compared with Bloombergs market forecast, the RMB has the second strongest fixing price in history (a difference of 918 points), as of writing this article, USD/CNH spot has fallen from 7.35 to 7.28; in the context of the recent rapid depreciation of the RMB, the Peoples Bank of China released the second quarter monetary policy report yesterday, in addition to the previous Central Political Bureau increased macro In addition to the consistent slogan of “intensity of policy adjustment”,For the first time, the Monetary Policy Committee explicitly mentioned resolutely preventing the risk of exchange rate overshooting as its official guidance; In addition, the official buying of Chinese stocks/H shares was also obvious yesterday, and the Hong Kong Stock Connect saw a large number of southbound fund inflows yesterday, and the Hang Seng Index rebounded from an intraday decline of about 2% and finally closed flat.

Unfortunately,Even a temporary lull in China-induced risk aversion won’t save the U.S. Treasury sell-off, steady initial jobless claims (-11K to 239K) and a rebound in the Philly Fed manufacturing index, which rebounded 25.5 points to 12, was positive for the first time in a year , much higher than market expectations, and all components improved, especially new orders surged 30 points; 30-year real yield (inflation-adjusted) rose to a new high of 2.10%,The yield curve continues to be bearishly steep, and the rise in interest rates is no longer led by the hawkish Fed, but driven by long-term interest rates and improving economic conditions, the 10-year yield hit a cycle high of 4.33% at one point before rebounding as stocks continued to fall, as traders pared some short bond positions amid fears of a sharp drop in risk sentiment.

Higher interest rates, longer-term narrative continues to weigh on stocks, especially for high-growth industries and companies with poor earnings, SPX was led by technology stocks (-1%) and consumer stocks (-1.6%) yesterday, and energy was the only sector that rose yesterday; The stock index fell 3.3% yesterday, while the Russell 2000 index fell for eight consecutive trading days and fell to its lowest level since July.

The general risk-off tone in the market finally spread to the cryptocurrency space, and the gold spot price (< 1890) and the cryptocurrency price plummeted in tandem in late New York, with extremely thin liquidity, the prices of BTC and ETH plummeted by nearly 15%. As expected, thisThe slump led to the liquidation of a large number of long futures positions, with the scale of liquidation reaching the highest level in months., exacerbating the downward cycle; and to complicate matters further, the subsequent news that the US SEC appeared to be “preparing” to approve an ETH futures ETF, according to “people familiar with the matter,” sent prices rebounding to recover about half of their losses.

We expect prices to continue to move in tandem with the risk tone in macro markets,In particular, whether interest rates will break higher again from current levels, it is recommended that you carefully control risks and adopt defensive strategies.

You can search for SignalPlus in the Plugin Store of ChatGPT 4.0 to get real-time encryption information. If you want to receive our updates immediately, please follow our Twitter account @SignalPlus_Web 3, or join our WeChat group (add assistant WeChat: chillywzq), Telegram group and Discord community to communicate and interact with more friends.

SignalPlus Official Website：https://www.signalplus.com