Market Update: Fri 9th Aug

Crypto surges back

gm

**MACRO** - So this week it feels like we're a bit more in the clear although I remain somewhat skeptical. Allegedly 60% of the Yen carry trade has been unwound and of course we had Uchida publicly state that the BoJ would not raise rates in times of market instability. We saw a strong rebound in stocks which closed 2.3% better on SPX yday and 3% better on NDQ, while futures are up again this morning. It's incredible that we saw the VIX reach levels not seen since COVID and the GFC and we've simply just brushed everything off. IMO thatis an insight into how much leverage there is in the system; I feel like the paradigm has shifted a bit now...we were long in a period where I felt like the market was too bearish/under-risked and it now feels like the opposite where everyone is bullish and sitting on massive leverage (and I'm not even talking about crypto). This is not a signal to necessarily sell; price action to the upside can continue for a long time, but I think it's a signal to exercise caution and not be so gung ho (I know those who know me will be wondering why I don't practice what I preach lol and sometimes I ask myself the same question).

**CRYPTO** - We're moving higher along with equities but it's still quite big underperformance; BTC has climbed back above towards $61k while ETH remains in the gutter at 2665 although I would note that ETH/BTC is slightly off the lows while SOL/ETH is off the highs. It's been a woeful performance for ETH, with a big drop in narrative and a lot of forced selling driving it lower, while ETF inflows have failed to really make a difference. Part of me thinks it might be a bit of a buy here, but in general I've sort of given up on ETH and would look to sell strength on it into either SOL or BTC. Memecoins are displaying a relatively strong bounce in the past few days climbing by 50-100% in many cases, while the biggest news of yesterday was yet another alleged TRUMP token which ended up rugging. On the whole I'm still exercising caution on crypto with the recent bounce, and would look to add risk if we dropped meaningfully lower. I think I'm going to continue to sit in the camp of it feels like late innings, unless we get a Trump victory and some fast action on implementation on the back of that.

GL today