Well let's see the market from a macro-economic perspective , trying to understand what happened and what we can expect in this 2022.
1 - People are too focused on inflation but the causes of market movements are other and sometimes very simple.
I remember that March 9, 2020 as it was now..
I remember that March 9, 2020 as it was now..
2- With a colleague/friend of mine we started analyzing the market and made some mistakes, but we realized, following the news, that the markets would see a big rush. The cause was that the pandemic would cause an immense flow of money, i bought again like 300 eth at 100$
3- For this we must understand how the United states Central bank Balance sheet works and that inflation is only a consequence that will stabilize again and it does not decide the markets like i just said some weeks ago.
This can help you for sure:
investopedia.com/articles/econo…
This can help you for sure:
investopedia.com/articles/econo…
4- To put it simply, the FED has begun fast to inject liquidity in response to the pandemic, mainly by buying assets and providing credit to the underlying banks
This liquidity caused the stock market and consequently the crypto market to rally, pratically what Tether did too
This liquidity caused the stock market and consequently the crypto market to rally, pratically what Tether did too
5- So liquidity entered the stock market, technological stocks and crypto, the market started to pump and volumes grew, also many SPAC started to pump and we also saw a bullish market there, everything moves together
FED balance sheet vs #BTC price
FED balance sheet vs #BTC price
6-
First picture:
Here an interesting chart about FED balance sheet and inflation
Second picture:
We can compare FED balance sheet with Dowjones and #BTC for have a macro-economic perspective.
First picture:
Here an interesting chart about FED balance sheet and inflation
Second picture:
We can compare FED balance sheet with Dowjones and #BTC for have a macro-economic perspective.
7-
We can assume that Republicans have exaggerated a bit unlike Europe / BCE which has been much more cautious and has moved more steadily .. now in the US the consequence is paid with a large rise in the CPI with less stable prices..
We can assume that Republicans have exaggerated a bit unlike Europe / BCE which has been much more cautious and has moved more steadily .. now in the US the consequence is paid with a large rise in the CPI with less stable prices..
8-
..but as you understand this caused the great bullish market of 2021, not surprisingly.. let's go to compare again with #btc and #Ethereum price 😂
Plain and simple...
..but as you understand this caused the great bullish market of 2021, not surprisingly.. let's go to compare again with #btc and #Ethereum price 😂
Plain and simple...
9-
Well, now let's move on to the bad news started with Powell's "inflation no longer transitory" comment of November 30.. Thank you so much
Well, now let's move on to the bad news started with Powell's "inflation no longer transitory" comment of November 30.. Thank you so much
10-
Practically Powell was hinting at the end of expansionary monetary policy and slowing QE tapering so reverting into QT.. FED had been adding $120 billion a month after March 9 through QE ... Each stock asset and crypto asset have seen his top on mid november...
Practically Powell was hinting at the end of expansionary monetary policy and slowing QE tapering so reverting into QT.. FED had been adding $120 billion a month after March 9 through QE ... Each stock asset and crypto asset have seen his top on mid november...
11-
On 15 december Powell become more hawkish and culminated with the FOMC minutes released on january 5
nytimes.com/2022/01/05/bus…
On 15 december Powell become more hawkish and culminated with the FOMC minutes released on january 5
nytimes.com/2022/01/05/bus…
12-
This was really bearish and i would like to admit, like i stated in a chat with friends, that powell acted ina bad way... and on january 11 tried to fix it...
reuters.com/markets/asia/l…
This was really bearish and i would like to admit, like i stated in a chat with friends, that powell acted ina bad way... and on january 11 tried to fix it...
reuters.com/markets/asia/l…
13-
Each stock and crypto asset have seen his top on mid november after 20 days of crazy run ... this we can say has invalidated any theory of #btc to 100k, #eth 10k and any prediction of the cycle until the end of 2021, so not get angry with your favorite CT but with Powell
Each stock and crypto asset have seen his top on mid november after 20 days of crazy run ... this we can say has invalidated any theory of #btc to 100k, #eth 10k and any prediction of the cycle until the end of 2021, so not get angry with your favorite CT but with Powell
14-
While this broad expansive policy has caused huge gains also in crypto as it is a risk asset, so huge liquidity-investors were ready to bet on x10-100, now with rate hikes and supply decreases, the dollar takes interest and everything goes towards it like rivers in the sea
While this broad expansive policy has caused huge gains also in crypto as it is a risk asset, so huge liquidity-investors were ready to bet on x10-100, now with rate hikes and supply decreases, the dollar takes interest and everything goes towards it like rivers in the sea
15-
what can we assume, taking back this chart, we will not see another 2021 for sure with huge money come (picture 1)
but as history teach, the end of monetary expansionary monetary policy on 2014 used during the 2007-2009 crisis, we will see a flat 2022 and 2023 (picture 2)
what can we assume, taking back this chart, we will not see another 2021 for sure with huge money come (picture 1)
but as history teach, the end of monetary expansionary monetary policy on 2014 used during the 2007-2009 crisis, we will see a flat 2022 and 2023 (picture 2)
16- Something like this into 69-30 or 40k range?
Who knows..
But what is summarized in this article are fundamental milestones that will drive the market:
cnbc.com/amp/2021/12/15…
Who knows..
But what is summarized in this article are fundamental milestones that will drive the market:
cnbc.com/amp/2021/12/15…
17-
key points:
-increase in interest rates
-the dollar will acquire interest
-there will be less risk attitude for investors and funds
-the fed will reduce purchases and crypto will not be exempt from this macro-economic situation
key points:
-increase in interest rates
-the dollar will acquire interest
-there will be less risk attitude for investors and funds
-the fed will reduce purchases and crypto will not be exempt from this macro-economic situation
This in summary because inflation is only a consequence and data on 7.1% + or - are just a momentary situation as many are used to seeing, but the macroeconomic picture is saying that the FED will tighten its policies for two years.
Any bounce will be momentary and I do not expect a bullish market, capital rotation and Yield rewards allocation will be the key, it will be a year in which you can allocate assets in real estate for diversify or start crypto related activities
18-
As explained, the FED will aggressively dial back Bond, asset acquisition since the beginning of the pandemic, which have been a vector of the 2021 bullrun, seeing enormous flows of money enter in all markets, and seeing three rate hikes this year.
As explained, the FED will aggressively dial back Bond, asset acquisition since the beginning of the pandemic, which have been a vector of the 2021 bullrun, seeing enormous flows of money enter in all markets, and seeing three rate hikes this year.
19-
The Fed was tapering by $15 billion a month in November, doubled that in December, then will accelerate the reduction further come 2022, seeing as many as three rate hikes coming in 2022.
-March will be the first key month and investors will be ready to scale position imo
The Fed was tapering by $15 billion a month in November, doubled that in December, then will accelerate the reduction further come 2022, seeing as many as three rate hikes coming in 2022.
-March will be the first key month and investors will be ready to scale position imo
20-
Supply and demand imbalances related to the pandemic and the reopening of the economy have continued to contribute to elevated levels of inflation.
At the end of the year, the Fed will bring purchases to almost zero by starting the so-called Quantitative tightening
Supply and demand imbalances related to the pandemic and the reopening of the economy have continued to contribute to elevated levels of inflation.
At the end of the year, the Fed will bring purchases to almost zero by starting the so-called Quantitative tightening
21-
This will be reflected in the market and especially close to various Q2, Q3, Q4, volumes will be reduced and riskier crypto-assets will see a slow decline imoI take $Shib as a reference but that's what maybe we will see in many hiper pumped Altcoin in 2021
This will be reflected in the market and especially close to various Q2, Q3, Q4, volumes will be reduced and riskier crypto-assets will see a slow decline imoI take $Shib as a reference but that's what maybe we will see in many hiper pumped Altcoin in 2021
22-
There will be a continuous evolution of the defi, in search of yield protocols and there will always be opportunities in the crypto market to make money and speculation.
There will be a continuous evolution of the defi, in search of yield protocols and there will always be opportunities in the crypto market to make money and speculation.
23-
But I'm pretty sure we won't see a 2021 like, with just some localized hype like February and April maybe, due to macroeconomic and cyclical conditions. Your journey into crypto as an investor, researcher has just begun and will last for decades, do not rush act consciously
But I'm pretty sure we won't see a 2021 like, with just some localized hype like February and April maybe, due to macroeconomic and cyclical conditions. Your journey into crypto as an investor, researcher has just begun and will last for decades, do not rush act consciously
24-
We are approaching March and as expected the market begins to collapse after the second week of February, also due to the Ukraine-Russia situation.
What could be the economic implications?
In the first, the Russians invade, or at least cross over to Ukraine
We are approaching March and as expected the market begins to collapse after the second week of February, also due to the Ukraine-Russia situation.
What could be the economic implications?
In the first, the Russians invade, or at least cross over to Ukraine
25-
The news will of course scare the markets, which in any case expect it.
Nothing good, also because this time the central banks will not intervene to help investors, but will remain focused on fighting inflation.
No additional liquidity, therefore.
The news will of course scare the markets, which in any case expect it.
Nothing good, also because this time the central banks will not intervene to help investors, but will remain focused on fighting inflation.
No additional liquidity, therefore.
26-
If, on the other hand, the attack does not happen, that is, if the Russians and the Americans sit around a table looking for an agreement, then the markets will go up.
If, on the other hand, the attack does not happen, that is, if the Russians and the Americans sit around a table looking for an agreement, then the markets will go up.
27-
Furthermore, in March, the Fed has already said that it will raise rates and therefore reduce the liquidity it will put on the markets. The markets take this for granted, but how will it do it?
Furthermore, in March, the Fed has already said that it will raise rates and therefore reduce the liquidity it will put on the markets. The markets take this for granted, but how will it do it?
28-
Markets are pricing in at least six to seven rate hikes between now and the end of the year, for a total of around 1.75%.
Markets are pricing in at least six to seven rate hikes between now and the end of the year, for a total of around 1.75%.
29-
FED has understood that if it raises rates too much and does it too quickly, it will end up frightening the markets, that is, it risks making short-term rates rise more than long-term ones. which for the markets would represent a sign of recession.
FED has understood that if it raises rates too much and does it too quickly, it will end up frightening the markets, that is, it risks making short-term rates rise more than long-term ones. which for the markets would represent a sign of recession.
30-
In this way, the Fed will try to raise rates without frightening the markets and, above all, accustoming them to live with less liquidity. This will not appeal to the markets but somehow it has to be done.
In this way, the Fed will try to raise rates without frightening the markets and, above all, accustoming them to live with less liquidity. This will not appeal to the markets but somehow it has to be done.
31-
There is no doubt that in the last few decades the markets have been spoiled: they have received rivers of liquidity at very low prices, and specially in post-pandemic phase as we have seen from March 2020 to November 2021.
There is no doubt that in the last few decades the markets have been spoiled: they have received rivers of liquidity at very low prices, and specially in post-pandemic phase as we have seen from March 2020 to November 2021.
32-
People who are expecting a continuation of the bull run or a new altseason are either crazy or simply don't know the basics of economics and are misinformed.
People who are expecting a continuation of the bull run or a new altseason are either crazy or simply don't know the basics of economics and are misinformed.
• • •
Missing some Tweet in this thread? You can try to
force a refresh
