The information in this message does not represent any financial or investment advice. They're just random thoughts in my head.
gm
MACRO - Well what a squeeze yesterday, we saw SPX close 2.65% higher and NDQ close 3.46% higher. Equities continue their surge this morning with stocks up another 1.6-1.8%. Interestingly interest rates have been fairly stable with the curve still just off YTD highs, 444/421/399/402bps on 2s/5s/10s/30s. That right there I think shows you the pain trade for the market; everyone is bearish stocks, defensively positioned, possibly even short...but stocks just keep bouncing back aggressively despite a worsening macro "feeling"...it's because it's what I keep saying here. The writing has been on the wall for months and months now (pretty much the whole of the year actually); it's not something that has a surprise factor (like COVID) and people have had time to act and position. As such, it is the positioning itself that takes precedent over fundamentals and causes these moves. Does that mean we can't go lower? No. But it certainly does mean that stocks can be resilient and the longer they are the closer we may get to inflation coming under control and thus a Fed pivot, which makes having a short or defensive trade very challenging. To be clear, I don't think we see any communication of a Fed pivot for probably at least 12 months, but I can also see stocks flatlining for 12 months too. Just doesn't feel like to me there is going to be a capitulation barring some kind of black swan event.
CRYPTO - Feels like we're back to lack of vol here with BTC at 19.6K and ETH at 1337 (nice). We've seen a pretty huge surge in equities from their recent bottom and crypto hasn't really moved that much, but I suppose we've seen a massive outperformance of it since June as well. I was surprised to see $APE not move lower yesterday given the SEC backdrop and what seems like a delay to staking implementation, I suppose people really want to be in it for the trade which definitely causes a bit of caution for me understanding that it has certainly become a big consensus trade. Wish I had more to add here but I think it's just a case of holding the line positionwise in crypto.
NFTs - Well Azuki continues to have great traction with almost 1K ETH of volumes going through yesterday causing an 18% increase in price to a floor just shy of 12E. That's almost double from the lows in ETH terms. Beanz are also now back above a 1E floor. This comes after their announcement of a Physical Backed Token "an open source token standard tying a physical item to a digital token on the Ethereum blockchain"
At first glance one may think "who cares" wrt Azuki prices, but personally I think it's awesome to see such great additions to the Ethereum ecosystems, and undoubtedly allows Azuki to command a great amount of respect. It's a project that is highly community driven but clearly has a very talented team (whether you love or hate Zagabond). Indeed, Mando and I sold all our Azukis at the lows to buy a Nakamoto Rare Pepe Card as it was easier not to "depend on a team", but tbh I continue to be very impressed by this complex. Definitely a regret although at least we still have some Beanz. Elsewhere volumes seem "ok", I think this period of ETH stability continues to be promising for NFTs.
GL today.
-OSF