December 4 REX Wire Market Outlook

Risk-on appetite has returned, with stocks, gold, and crypto posting big gains.

Risk is very much back on.

As the first full week of the last month of the year rolls around, we take a look at what's going on in the TradFi and crypto markets.

And what a week it's shaping up to be. Risk is very much back on, driven by a dollar that is in a firm downtrend. Gold hit a new all-time high, with a weekly close at $2,072 and spiking as high as $2,147 intraday.

The S&P looks set to have taken out the last resistance level before its all-time high (4,819), with the same true of the NASDAQ.

This renewed optimism has been occasioned by falling CPI. This gave Joe Biden an excuse to show a woeful lack of understanding about inflation, and he was duly corrected by The Internet.

X is back in the news again, thanks to Elon Musk's controversial criticism of advertising partners who pulled their funding after the tech entrepreneur appeared to support an antisemitic post. X is now scrambling to reinvent its advertising policy, but there has also been a backlash against Disney+, with a wave of users posting images of canceled subscriptions on the social media platform.

Bitcoin Smashes $40k

Bitcoin closed the week just below $40,000 for the first time since May 2022, driven higher by a short squeeze on Friday and growing excitement about the ETF approval, which—assuming it happens—will take place within five weeks.

Michael Saylor has developed a clever approach to growing Microstrategy's bitcoin holdings. When MSTR trades above the value of the BTC "backing" it, Saylor sells more shares and uses it to buy BTC, increasing the amount of BTC per share in the process.

This strategy could also work if MSTR falls below its BTC value, since Saylor could sell some of the company's BTC and use it to buy back shares. However, while this would further increase the amount of BTC that backed each share, it would mean the company as a whole held less—which does not appear to be Saylor's aim.

Finally, Coinbase's share price is climbing hard as life returns to the crypto markets. It's looking set to open at $145, up nearly 400% from its $32 low at the beginning of the year.

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