Look Out Below

The news from Planet Ruby—Friday, July 5, 2024

• Signal: ₿
• Noise: $

Fiat Games

The US dollar has confirmed its sell-off at resistance, as we noted it should last week, following Powell's Tuesday speech. Powell stated that progress had been made on inflation, and that the "labor market is cooling off". However, "We need to be more confident before reducing policy rates."

This cautious optimism sent the DXY back down to 105, confirming 106 as the local top. The S&P had already put in a new ATH last Friday, breaking 5,500, and continued upwards this week following the news.

There's one group that will desperately be hoping for lower rates, and that's the large number of banks that are underwater on their bond portfolios. Lower interest rates mean higher bond prices, which is exactly the bailout they need.

There is, however, an asset class that has not benefited from the dollar's new weakness.

Crypto In Freefall

Bitcoin made a higher low last Friday, putting in a bottom at almost exactly $60,000, following the previous Monday's low at $58,500. However, the recovery didn't stick, and a move up to almost $64k proved short-lived. Bitcoin then revisited the $60k level—key support—and broke through on Thursday.

We're now in the unenviable position of looking for a bottom in a range where there's very little in the way of key support levels. $52k is a natural point for bitcoin to gravitate towards.

To the upside, $65k is also a critical level to overcome, before the old all-time high of $69k. This consolidation has now lasted almost four months. It is taking more time than expected for the market to digest the exuberance of the start of the year.

There have been a few negative news stories that may be influencing traders. The SEC has sued Consensys again, this time for running an unauthorized broker-dealer operation in the form of the DEX built into MetaMask. Consensys have collected millions of dollars in fees from this facility, even if they don't custody funds themselves.

Mt Gox repayments are now starting, and are expected to be made from now through to October. Some analysts are suggesting this might be a bearish event, since holders may want to sell.

The SEC has unexpectedly delayed the ETH ETFs, requesting minor revisions and potentially pushing the date back to the end of this month, rather than July 2, as many analysts believed.

What's New In The SKALEVERSE?

If you're at EthCC next week, don't forget to look up the SKALE team (and grab a drink while you're at it)!

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