Oh! I didn't expect that Yijie is Yige's woman, and she is already a mother of three children. I feel a little sad. Forget it, let's get back to the topic.
Those fools who shouted in the square: "Wait until the Hong Kong spot ETF is developed, it will break 100 billion US dollars in minutes, wake up! Hong Kong's ETF is not the ETF of the United States, don't be obsessed with it and mislead the students.
Although the topic of Hong Kong spot ETFs is very hot right now, and there is less than a week left before trading starts, it is expected to be launched as early as the 30th of the month.
However, Tangren believes that the Hong Kong ETF market faces enormous challenges if it wants to develop quickly. The first issue is the rate competition. After all, the emergence of Hong Kong ETFs is to compete with the global big ETFs.
Harvest, a Hong Kong spot ETF issuer, does not charge any fees in the first six months after the launch of the ETF, and the fee rate is adjusted to 0.3% after six months.
This is similar to the big ETF market. These Hong Kong ETF issuers also want to attract a large number of users in the early stages, but the price is to survive the first six months without any returns.
Secondly, considering the restrictions on the purchase of these products in the mainland and the size of the entire Hong Kong ETF market, there are only a few powerful investment banks, and those who recognize and favor them have already transferred their funds to BlackRock.
It is obviously unrealistic to persuade unapproving institutions to enter the market in a short period of time. Therefore, Tangren believes that even if it is fully opened and launched, the capital inflow will not be too large.
Finally, the current market environment is not good. Even in the big ETF market, the speed and scale of fund inflows have slowed down significantly, and geopolitical risks still exist.
Especially in the Middle East, the impact on the market is difficult to predict, and the war situation information changes rapidly. Major changes may occur within a few minutes after each report. It is normal for market funds to remain cautious.
Yesterday’s decline in Bitcoin was also related to the liquidity of the spot ETF market. Grayscale GBTC once again saw a large outflow, with the outflow of nearly 2,000 coins causing a shock to the market when there was no movement in various small spot ETFs.
Among the top three big pie ETFs, except for BlackRock whose data was not released, the inflows of Fidelity and ARC were very small, and the market performance of net outflow of funds is always not very good.
Although spot ETFs have seen positive inflows for three consecutive days from last Friday until the trading day of this Tuesday, the scale is actually pitifully small.
This is completely different from the period in February and March. Many people are now becoming cautious, and the futures market has not returned to a balanced level. Some altcoins are still dominated by shorts, which is incomparable to the previous level of popularity. The market still needs some time to recover.
Referring to the chart of global money supply M2, the price of Bitcoin is related to this supply. The rapid expansion of global liquidity and scarce assets such as Bitcoin provide ample purchasing power, so to some extent this has driven the bull cycle of the cryptocurrency market.
The current global debt level has hit a record high, and the fragility of the economic structure has led to concerns about the sustainability of the financial system. The increase in global M2 and the rising trend in bitcoin prices are basically synchronized.
In the current economic system, a growing money supply makes debt levels more unsustainable while providing an impetus for the prices of scarce assets to rise.
As an asset with a preset supply limit, scarcity has become a significant advantage in an environment of monetary expansion.
Therefore, as global debt problems intensify and money creation continues, the value of scarce assets such as Bitcoin and gold is likely to be higher in the future.
Moreover, Bitcoin’s inflation rate is already much lower than that of gold, which is actually a very bullish point, especially after the COVID-19 pandemic in 2020, when the Federal Reserve printed a large amount of US dollars, which not only exacerbated Bitcoin’s own inflation, but also pushed up the global inflation rate.
After a tight monetary policy, we always see a quantitative easing monetary system. After the Fed cuts interest rates, the market will release more liquidity, which is of course conducive to the rise of the cryptocurrency market.
Therefore, what Tangren wants to tell everyone is: Don’t be anxious about the current correction and consolidation, you need to be patient in the bull market, and every adjustment in the market is to prepare for the next higher impact.
Market Interpretation:
The market has entered a period of adjustment. Although there was a small pullback in the morning, the adjustment is still not in place. The next trend will most likely be bearish. Tangren believes that the adjustment period is expected to be three days, and the support level will return to 60,000 points before it will accumulate momentum to attack upwards.
There is no big problem with the current shock adjustment. Just hold your position patiently and wait. As long as it does not break through 60,000, the bullish trend will remain unchanged. In case it falls below, be prepared. Tangren will inform you of the opportunity to enter the market in advance.
Tangren writes articles carefully every day to provide you with certain reference and decision-making value. If you think it is well written, please like, follow or forward it. This is the greatest encouragement and support to Tangren, and also the greatest motivation for Tangren.
