Weekly Market Update: Sideways Chop

All the macro headlines this week have resulted in that nasty sideways chop. Turns out all markets dump on bad geopolitical news, however Bitcoin responds a little differently afterwards. Speaking of Bitcoin, it continues to hold its spot as this year’s best performing asset. 

In the crypto news, XRP went from high (ETF filing) to low (SEC challenged their court decision). Price mirrored sentiment. In this week’s edition of insto news, Robinhood and Swift are both ramping up their digital asset services, while the Emirates are making some moves in the crypto space. 

In macro market news, the port strike in the US was settled very quickly, shipping rates are down but Oil is up on Middle East fears. Can’t catch a break it seems. 

In the US, employment was staggeringly strong, way over forecast and unemployment has actually declined. Traders will have their abacuses out now trying to refactor the rate cut trajectory. 

Not much news this week from Europe; Germany’s factory orders are well down, and while consumer spending was up, it missed expectations. 

In APAC, China’s been on holiday so all is quiet there. Japan’s consumer sentiment is up and India’s PMI finally dropped. 

Locally, Australia’s retail spending ticked up, but Manufacturing PMI contracted significantly. 

In New Zealand the only topic of conversation seems to be the Monetary Policy Committee rate decision. Most folks were calling for a 50 bps cut to mirror the US and provide the economy with some relief. The RB came to the party cutting the OCR by 50 bps to 4.75%

Market sentiment has been as flat as prices remaining unchanged in neutral territory.

Highlights this week: 

• This week has been notable for its lack of action with most of the top 30 assets moving by small single digits. 
• Once again, our Buy-Sell ratios remain at the long term average. 
• There has been a noticeable increase in BTC volume this week, with most of it skewed to the buy side. 
• At the time of writing, BNB was up 4.6% on the week, while BTC was flat. SOL and ETH were down 1%
• Layer 1 SUI led the way this week up 15% . 
• BEAMX takes out the position of worst performer, down 19% this week. 

View all top gainers: Visit the top gainers page to find out more.

Highlights from the crypto space

NYDIG analysis of Bitcoin shows that it is still this year’s best performing asset. 

Here’s an interesting piece by Milkroad; “Markets dump on almost every geopolitical event… Bitcoin is always the fastest asset to recover”. BTC appears to function as the purest barometer of market sentiment and liquidity.

Bitwise has filed an application for an XRP ETF. Unfortunately, a day later the SEC filed an appeal in its long run court case against Ripple. The Ripple CEO wasn’t mincing his words. 

Other notable highlights from around the crypto space:

• FTX will repay ~98% of what they owe to creditors. It’s about $16bn and it’s all in cash. That has some predicting a cash injection into the ecosystem. 
• Robinhood is enabling crypto transfers in selected European countries. We would call that deposit and withdraw. 
• Swift is starting live trials of digital asset settlement in 2025. 
• When Altcoin season? Not yet according to Kaiko, however price performance is improving.

• Experts had a punt on what impact the different Presidential candidates will have. TLDR; crypto wins. 
• Tether (USDT) continues to be delisted by European exchanges because it won’t become MiCA compliant. 
• The UAE has exempt crypto transactions from VAT, a move that aligns it with other financial instruments. Dubai has also ruled that you can be paid in crypto – if the contract terms are clear. 
• Coindesk did an exposé on how North Koreans are evading sanctions and getting hired by blockchain businesses. 

🌎 Macro news TLDR: …Semiconductors are the new battleground.

Iran’s actions over the weekend and the threat of escalation meaning a potential impact on oil supplies have the Oil markets on edge and prices edging up. Could the 1970s be back is the question? 

Containerised shipping rates continue to fall. 

U.S. economic news

Services ISM was up significantly. US jobs data continues to confound. The ADP employment report came in way over the 90k estimated, at 143k.

Non-Farm payrolls confirmed this trend, coming in at double forecast. Unemployment actually fell to 4.1%. Last week’s jawboning by the Fed makes sense now.

The port strike ended rather quickly (nothing like leverage), but there will be a large backlog of ships. August’s trade deficit fell on higher than expected exports. 

Over in Europe….

August’s retail spending in the EU tweaked up, but was less than expected. 

German factory orders in the year to August were down 3.9%, which was actually better than the July result. 

And in Asia Pacific…

China has been on holiday the last week, so no updates there. Japanese consumer sentiment is improving. India’s PMI for September dropped to 56.5 as competition ate into new orders. September CPI in South Korea was 1.8%. 

Australian retail sales were up 3.1% for the year ending August. This is the first time it’s been above inflation for some time.

Australian manufacturing PMI contracted significantly more than expected and forward indicators are not great. A second PMI report mirrors this. Business sentiment rose slightly in August. 

In New Zealand, the only news this week was the much awaited MPC decision on the OCR. The pundits have been having a field day with many clamouring for a 50bps cut to relieve economic stress.

For once the RB came to the party with 50bps cut to 4.75% to offer some mortgage relief and drive what was called a ‘subdued’ economy… let’s see!

That’s a wrap for this week. 

Stay tuned for the next update.

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