January 29 REX Wire Market Outlook

All of the numbers are going up, and that's only partly a good thing.

Is this the week where the Grayscale dumping ends?

Somehow, January is already drawing to a close, and it has been an important month for the markets.

The S&P 500 made all-time highs five days in a row last week, though it's also worth remembering that inflation is playing its part and that performance isn't as impressive as it seems. In real terms, the S&P is around 9% below its previous peak.

Tech has very much been driving the action. Microsoft is now larger than the GDP of France, and tech accounts for 30% of the S&P. The last time the number was that high was, well, 2000. Probably nothing to see here, though.

Chinese stocks rallied hard as the People's Bank of China eased liquidity requirements for banks and the government indicated further stimulus is to come. However, a nasty surprise has come in the form of Evergrande. A Hong Kong court has ordered the property giant to liquidate, two years after it defaulted on its $300 billion debt. The company will continue to operate in mainland China.

In the EU, the ECB is closely watching employment figures before making a decision on interest rates. Wage growth stood at 4.7% for Q3. Employment rates are at record lows across the bloc, and average working hours have decreased, suggesting that companies are hesitant to lay off staff.

Bitcoin Recovers But Intermediate Trend Unclear

Bitcoin has bounced from its low of $38,500 last week to close just above $42,000. It has been less than three weeks since that local top at $49,000 when the ETFs launched, which is very short for a pullback (they typically last between one and three months). The drawdown was also mild: Just 21% from the peak to the bottom last week. Analysts are divided on whether we're done.

Friday's ETF flows were positive for the first time in days, and there's hope that Grayscale's bleeding might be slowing. GBTC outflows were "only" $255 million on Friday, allowing a net inflow of $14.8 million after four straight days of heavy outflows. Finally, the tide may be turning. Although ETFs are actually a relatively small percentage of total spot trading volumes, this would provide a confidence boost to traders at the very least.

Alts have outperformed over the past week, rallying hard as bitcoin bounced from that $38.5k level. SOL, in particular, has done well, bottoming at $80 and seeing a 20% gain.

Meanwhile, major publications like Fortune are calling Craig Wright "Fake Satoshi" in print, apparently without any fear of being sued for libel.

Fortune article screenshot
Fortune's lawyers are clearly seeing the writing on the wall for Craig.

This probably means things are going Not Well for him and the outcome of the COPA trial is set to be decisive.

Walls Close In On “Satoshi” In COPA Trial
Wright was found to have faked large amounts of evidence, including early versions of the Bitcoin white paper.

Finally, the US has filed notice of its intention to sell $130 million in BTC seized from dishonest Silk Road agent. That's at a time when US debt is over $34 trillion, interest payments are over $1 trillion per year, and set to hit $3 trillion by the end of the decade.


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