Financial Analyst/Content Writer, RADEX MARKETS
Lawrence J. came from a strong technical and engineering background before pivoting into a more financial role later on in his career. Always interested in international finance, Lawrence is experienced in both traditional markets as well as the emerging crypto markets. He now serves as the financial writer for RADEX MARKETS.
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The brutal selloff in cryptocurrencies pushed Bitcoin all the way down to $80,000 last Friday – prices not seen since the April tariff scare. From $125,000 back in early October, the descent represents a 35% drawdown, something not uncommon for Bitcoin in or out of a bull market. The question is whether the move is over or if there is more pain to come. Bitcoin finally showed a measure of strength over the weekend, rebounding from the lows to touch $88,000 on Sunday. Given the chaotic sentiment currently pervading financial markets, calling for a bottom is even more challenging than usual, but the reversal appears to be holding steady as of this morning.
Another reversal occurred on Friday, this time in the Fed rate prediction market. Traders were starting to abandon all hope of a December rate cut, with FedWatch tipping heavily in favour of a rate hold during the next meeting. However, for reasons that are not immediately apparent, the odds have now flipped to 70/30 in favour of a 25-bps cut. New York Fed President John Williams commented on Friday that he sees room for an interest rate cut in the “near term”, but other members are not so keen on the idea. Historically, FOMC members were relatively united in their voting intentions, with maybe a couple electing to dissent at most. This time however, the committee appears split right down the middle. The uncertainty is spilling over to markets at large, none more so than cryptocurrencies. Just over two weeks to go.
US economic data is slowly starting to trickle through. The government shutdown left a hefty backlog that will take a while to clear, and some reports may never be published at all, but this week will provide markets with a couple of important data points at the very least. Firstly, September PPI figures, although coming out weeks behind schedule, may provide some information regarding underlying inflation pressures in the world’s largest economy. Secondly is the publication of retail sales, also for the September period. Both reports are set to be released on Tuesday. The PCE price index, previously scheduled for publication on Wednesday, has been put on hold by the Bureau of Economic Analysis, with no new date announced as of yet. Events taper off even more during the latter half of the week, as US markets will be closed all day on Thursday for Thanksgiving, and will close early on Black Friday.
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