Last week was the Thanksgiving holiday in the United States, resulting in light market trading volume and an overall consolidation pattern. The U.S. stock market is poised to make history again, with 2024 set to be one of the best-performing years in history, and five out of the past six years achieving double-digit returns.
Market breadth remains supportive, with the difference between the number of new highs and lows for stocks over 52 weeks looking healthy. The upward trend remains intact, and the volatility index (VIX) is on a downward trend. Meanwhile, after Trump announced Scott Bessent would be appointed Secretary of the Treasury, the U.S. bond market returned to calm, with the 10-year yield falling nearly 35 basis points from its October peak.
Aside from his so-called 'support for cryptocurrency' stance, Bessent is also a supporter of fiscal hawks and an independent Federal Reserve. His proposed 3-3-3 plan (reducing the fiscal deficit to 3% of GDP, increasing real GDP growth to 3%, and daily energy production by 3 million barrels) has brought relief to the U.S. fixed income market. Since his nomination, the yield curve premium has remained stable at current levels.
Despite lingering doubts about his core views, reporters found in his early speeches that due to the central bank's continued accumulation, he is 'long-term bullish' on gold. Will this have a spillover effect on Bitcoin, especially in light of recent discussions around strategic reserve portfolios? At the very least, the next four years will undoubtedly be very interesting.
Traders will return to a busy week, welcoming the last non-farm payroll data release of the year. Although concerns about rising inflation have just emerged, the market still anticipates about a 65% chance of interest rate cuts. However, considering the strong economic situation, long-term rate cut expectations for 2025-2027 have been significantly reduced. Regarding employment data, the market expects overall employment figures to rebound to around +160,000, while the unemployment rate is expected to remain at around 4.3%. Given the recent weakness in PMI surveys and high-frequency employment data, the final data results may also fall below expectations, but unless there is an extremely surprising result, risk sentiment may still remain positive.
Optimism in the cryptocurrency market remains widespread; however, this week's focus is on Ripple. In anticipation of the government potentially withdrawing its long-standing lawsuit, XRP surged an astonishing 73%, this significant rally helped XRP surpass USDT to become the third-largest cryptocurrency by market cap. Anticipating this development, whale addresses have been actively buying (and are now selling) XRP over the past month.
The current rally is primarily focused on mainstream coins (excluding ETH), with BTC leading the charge, while altcoins are still struggling to return to January's highs. Although the recent successes of L2 and protocol-transforming blockchains (like Hyperliquid) continue to dominate attention in the cryptocurrency market, we are seeing some improvement in Ethereum with the inflow from the ETH ETF, which exceeded $330 million last Friday. Will we see more secondary mainstream coins rebound before the end of the year?
Regardless, the fundamental indicators for cryptocurrency remain optimistic, with the market cap of stablecoins finally surpassing the peak during the Terra-Luna era. Stablecoins are usually the first stop for most fiat currency users entering the cryptocurrency market, and a higher market cap (price fixed and thus completely driven by quantity) indicates greater mainstream participation.
With investors pouring more new funds, will the new year see faster growth? Let's hope so!
