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BESOMEBODYFX
CRYPTO GLOBAL MACRO Q2 2024
TURNING NEUTRAL TO POTENTIALLY BEARISH. HERE’S WHAT YOU NEED TO KNOW…
Crypto is in full bull market mode.
People are looking for the next 100X coin, and BTC is going to 100k.
Looks and feels euphoric.
Risk assets are all benefiting from the same surge in risk appetite fueled by the FED’s decision to soon start cutting rates.
With that in mind…
We took profits on our positions.
Keep in mind that the straightforward bullish phase for crypto was from when the FED stopped hiking rates and inflation was falling rapidly, now the context with both growth and inflation starts to turn more mixed, less clear, in other words, riskier#BTCUSD #Bitcoin #BTC
— BeSomebodyFX (@BeSomebodyFX) March 25, 2024
In the previous crypto update we have mentioned how yes the context was still bullish, but…
How risks were rising and how we were looking to take profit.
And we did.
The clear bullish phase was from when the FED stopped hiking rates.
We positioned for that in the Private Network with both S&P500 and ETH longs. We took profits on the S&P500 longs in mid January, and we took profits on the ETH longs in mid February.
Yes, a bit too early.
Things went much after that.
But we caught a good chunk of the run anyway.
Now…
We have two policy scenarios ahead.
One where the FED starts cutting rates.
Which, counterintuitively, is NOT exacty bullish.
Remember? The 2019 type of price action:
When the FED starts to cut rates the economy takes a turn, usually.
And that’s NOT bullish for risk assets, crypto included.
While instead, the other type of scenario is one where inflation bottoms…
Forcing the FED to keep rates higher for longer.
Ok, hold on a second…
Two slightly higher than expected inflation prints don’t make a resurge in inflation the base case. I doubt high inflation is going to be the scenario. But it’s a possibility.
So, you get the point.
Risks for risk assets are… rising.
Whether that’s a recession, a resurge in inflation, or both together. We can’t know.
But what we can know is that the risk reward from a technical and fundamental perspective is NOT favorable for staying long right now.
And so we took profits.
What to keep in mind…
The straightforward bullish phase was from when the FED stopped hiking rates.
Now the fundamental context starts to turn more mixed, less clear, simply…
Riskier.
Keep that in mind.
Farily straightforward.
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