Trakx Weekly Update: November 4

Key Crypto Market Figures

CTIs Weekly Performance

Last week was a bit of a mixed bag for digital assets. Our benchmark Top10 Crypto CTI slipped 1.5% on the week notwithstanding a positive contribution from the market cap leader Bitcoin. Indeed, the Trakx Bitcoin Momentum CTI was the best performer over the past seven days, gaining 1.2%. At the other end of the performance stack was the Recovery, NFT Metaverse and Gaming CTIs, all of which dipped by more than 11%.

Soft US Employment

One factor that gave crypto prices a boost, and which put Bitcoin within spitting distance of printing a new all-time high, was a very soft US non-farm payroll report. The headline number was barely in positive territory coming in at just 12K (actually it would have been negative if not for 40K new government hires last month). October’s data marks the weakest US employment reading in almost four years, and while one-off factors like the Boeing strike or the impact of Hurricanes Helene and Milton account for some of the surprise weakness, it is worth noting that the job gains in the prior two months were marked substantially lower. Such downward revisions suggest the US employment picture is not as rosy as previously thought and, as a result, the overwhelming consensus is for a 25bp rate cut at this week’s FOMC meeting.

Presidential Vote In Focus

A rate-cutting FOMC meeting would normally be considered the main event but not this upcoming week. Instead investors, both tradfi and crypto, are firmly focused on Tuesday’s US presidential election. Momentum over the past month has been firmly in favour of team Trump. They have been well ahead in the online betting markets if not in the opinion polls, and this had provided a boost to digital asset prices given the widespread perception that he is the more crypto-friendly candidate of the two. However, in the closing days of the presidential race the odds of a Trump victory have tumbled – a shift that has weighed on crypto prices.

Trump’s Victory Odds Slump

According to Polymarket – one the the most widely tracked online betting platforms in this election race – Trump’s odds of winning slumped from a predicted 67% last Wednesday to 58% currently (at one stage over the weekend it was as low as 54%). Undoubtedly, some last minute profit-taking and de-risking have contributed to this pull-back but the move reflects more than just position squaring. What really drove the move was a new poll predicting that Trump could lose Iowa, a state he won in both of the two prior presidential elections. The poll was conducted by Ann Selzer, a respected pollster who has a strong track record of calling election results in the state. Given this presidential election will be won or lost depending on how the swing states fall, Selzer’s poll significantly muddied the waters regards the outcome of Tuesday’s vote because Trump failing to take Iowa will be a significant roadblock on his journey to retake the White House. Indeed, depending upon how the vote ends up it is quite possible that we won’t know who will become the 47th US President for some time. All things considered it is shaping up to be an interesting week ahead!

Sources: Trakx, Coingecko, Alphavantage

Market Trends

• Bitcoin traders eye key levels as US jobs shock sends BTC price past $71K: Cointelegraph.
• Trump reaffirms support for Bitcoin on Satoshi’s whitepaper anniversary: CryptoSlate.
• Bitcoin Slips as Trump’s Odds Plummet, Pushing Crypto Liquidations Above $315M: Decrypt.
• New Satoshi reveal grift just dropped: charge £500 entry: Protos.
• UBS joins BlackRock and Franklin Templeton with tokenised investment fund: DL News.
• MakerDAO founder proposes strict deflationary tokenomics amid rebranding process: CryptoSlate.

Trakx News

• Ryan Shea published the October crypto monthly update Crypto Countdown looking at how things stand ahead of this week’s US presidential election.

Trakx CTIs Performance

Sources: Coingecko and AlphaVantage

*Return of bitcoin is calculated since 01/05/2020, while CTIs performances were calculated since their respective launch date.
**Includes simulated performance.
***The risk signal is determined according to the historical volatility level, the higher the riskier.

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Disclaimers: No Investment Advice. Index returns and statistics are for illustration only. Index returns do not reflect any transaction costs or expenses. Past performance does not guarantee future results. The information provided in this newsletter does not constitute investment advice, financial advice, trading advice, or any other sort of advice and you should not treat any of the newsletter content as such. Trakx.io does not recommend that any cryptocurrency should be bought, sold, or held by you. Readers shall conduct their own due diligence and consult their financial advisors before making any investment decisions.