The Market Situation Report is a condensed version of our institutional newsletters, infused with a touch of humor. We plan to release it daily, right before the opening of the US market, and present it in a most familiar format to retail traders’ eyes by using Tradingview charts and Memes. To learn about the incentives behind it you can visit the link below.
Tether, Yuan, and junk currencies, making sense of Bitcoin, and NVidia!
Wow, that heading is quite something! Let’s start with what is going on in the fantasy world of Tether by developing a chart!
Gray: USDT MCap, Red: USDC MCap, Blue: Central bank cumulative liquidity. Is it necessary to say CB’s response to COVID-19 saved Tether and Bitfinex from insolvency? SBF’s FTX entering the US Market to let US-based customers involve in the crypto market with their USD, which Tether was in dire need of, could not be that perfectly timed!
Another amazing observation from the chart above! Luna goes down, USDC MCap up, USDT MCap down! Almost like some exchanges (FTX) were redeeming USDT to buy USDC and at the same time, Retail was redeeming USDC because it was easy to do!
After FTX’s bankruptcy, USDC MCap was down, and USDT MCap was Up! That might sound like a joke but it is not! Tether needs to keep its biggest Exchange floating. They bail out Binance with USDT while keeping the price of BTC up, and Retail still redeeming USDC.
hmm, let’s add Evergrande to this chart.
Strange! Evergrande trade halts and Luna goes down! Why so much correlation to China? Wonder what happened to Bitcoin? no need to!
Evergrande in green and BTC in orange. As you can see, these movements never happen in a vacuum. Wonder how Crypto has an impact on junk currencies? Russian ruble comes first in purple!
Much clear picture of who sold its BTC holdings to save the currency! USDCNH comes in another variation of purple!
I wonder what we can see if we add NVIDIA (with BTC in the same pane) and USDJPY(pane below)?
What should you be worried about? CNH/JPY conversion rate! if it rebounds, recession is ahead!
The only thing you need to worry about right now is the optimism developing in the US market. As confidence is peaking in the US financial market, rates become more prone to further ineffective hikes. We will talk about it more tomorrow!
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