Original title: (SignalPlus Macro Analysis Special Edition: Final Stretch)
Original source: SignalPlus
Last week was the Thanksgiving holiday in the United States, and market trading volume was light, maintaining an overall consolidation pattern. The U.S. stock market is about to make history again, with 2024 set to become one of the best-performing years on record, and 5 out of the last 6 years achieving double-digit returns.
Market breadth remains supportive, and the difference in the number of new highs and new lows for stocks over the past 52 weeks still looks healthy, with the upward trend intact. The volatility index (VIX) is trending downwards, and after Trump announced that Scott Bessent would serve as Treasury Secretary, the U.S. bond market has calmed, with the 10-year yield down nearly 35 basis points from its October peak.
Aside from his so-called 'support for cryptocurrencies' stance, Bessent is also a proponent of fiscal hawkishness 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 boosting energy production by 3 million barrels per day) has eased the U.S. fixed income market. Since his nomination, the yield curve premium has remained stable at current levels.
While there are still doubts about his core views, reporters discovered during research on his early speeches that due to ongoing central bank accumulation, he is 'long-term bullish' on gold. Will this have a spillover effect on Bitcoin, especially with recent discussions about strategic reserve portfolios? At the very least, the next four years are sure to be very interesting.
Traders will return to a busy week, gearing up for the last non-farm payroll data release of the year. Despite recent concerns about rising inflation just surfacing, the market still expects about a 65% chance of interest rate cuts. However, considering the strong economic conditions, long-term rate cut expectations for 2025-2027 have been significantly reduced. In terms of employment data, the market expects overall employment figures to rebound to around +160,000, while the unemployment rate remains around 4.3%. Given the recent weakness in PMI surveys and high-frequency employment data, the final data outcome may also be below expectations, but unless there is an extremely surprising result, risk sentiment may still remain positive.
Optimism in the cryptocurrency market remains widespread, but this week's focus is on Ripple. In anticipation of the government withdrawing its long-standing lawsuit, XRP surged an astonishing 73%, helping it surpass USDT to become the third-largest cryptocurrency by market capitalization. In light of this development, whale addresses have been actively buying (and are now selling) XRP over the past month.
The current upward trend is mainly concentrated in mainstream coins (excluding ETH), with BTC leading the charge, while altcoins are still struggling to return to January's highs. Although the recent success of L2 and protocol-transforming blockchains (like Hyperliquid) continues to dominate attention in the cryptocurrency market, we are seeing some improvement in Ethereum through the inflow of ETH ETFs, with over $330 million flowing in last Friday. Will we see more secondary mainstream coins rebound before the end of the year?
Nonetheless, the fundamental indicators for cryptocurrencies remain optimistic, with the market capitalization of stablecoins finally surpassing the peak during the Terra-Luna period. Stablecoins are typically the first stop for most fiat users entering the cryptocurrency market, and a higher market capitalization (price fixed, thus entirely driven by quantity) indicates greater mainstream participation.
As investors put more new funds in, will the new year see faster growth? Let's hope so!
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