💥 Bitcoin Soars: New All Time High of (Almost) $98k!

Good Morning!

Nvidia, the AI darling that's been Wall Street's golden child, just served up a reality check with projections of its slowest revenue growth in seven quarters. Investors are slightly rattled, but not panicked. Meanwhile, Bitcoin is laughing in the face of market uncertainty, rocketing towards the psychological $100,000 milestone. Traders are betting big on a potential Trump 2.0 administration delivering crypto-friendly regulations, fueling a 40% surge in just two weeks. The dollar's holding steady, tech stocks are feeling the pressure, and the markets are bracing for what comes next.

In today’s email:

• PMI: Critical PMI data on the horizon

• Bitcoin: Hits $97.7k! 🚀 $100k soon!

• Ethereum: Continues to underperform

• Gold: Bouncing back already, now $2665+

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THE BIG IDEA

Upcoming global PMI data could trigger significant market shifts, challenging the two-month narrative of rising U.S. inflation and dollar strength

Markets are teetering on the edge of a potential seismic shift. The past two months' dominant story – surging U.S. inflation driving bond yields and dollar strength – is losing momentum. Incoming PMI data could be the catalyst for a broader market recalibration.

The financial landscape has been defined by a straightforward narrative: the U.S. economy outpacing global competitors, fueled by President-elect Trump's trade policies and the Federal Reserve's strategic moves. But this story is showing signs of fatigue. Bond markets are oscillating in choppy ranges, and the dollar's speculative appetite seems exhausted.

Citigroup's analytics reveal a subtle yet significant trend:

Non-U.S. economies are quietly improving relative to expectations. The Eurozone, the third-largest global growth engine, is emerging as a standout, with economic data surprises trending positive. This could be the inflection point that reshapes market dynamics.

A strong Eurozone PMI could prompt investors to reassess European Central Bank rate cut expectations. Such a development might narrow yield differentials, potentially weakening the dollar and creating a domino effect across financial markets. Stock markets could turn lower as borrowing costs adjust, while bonds might see increased capital inflows seeking safer harbors.

The upcoming PMI data is more than just another economic indicator – it's a potential watershed moment. Investors should brace for possible repositioning as global economic narratives realign. The markets are signaling a complex, nuanced shift that could redefine investment strategies in the coming months.

MARKETS AT A GLANCE

TOP NEWS

Gautam Adani faces federal fraud charges in New York, triggering massive stock selloff across Adani Group companies

Adani Group's empire is crumbling after U.S. federal charges allege a $250 million bribery scheme. Shares nosedived – Adani Enterprises plunged 23%, Green Energy tanked 18.95%. The indictment accuses Adani and seven others of massive corruption in securing solar energy contracts, sending shockwaves through India's corporate landscape.

Escalating Russia-Ukraine conflict drives natural gas prices higher, with energy markets closely monitoring potential infrastructure attacks and supply disruptions

Geopolitical drama is heating up commodity markets. Ukraine's missile strikes into Russia are rattling energy traders. Natural gas prices spiked 2.5% on TTF, while European storage dips below seasonal averages. Investment funds are going long, betting on continued market volatility.

Bill Hwang receives 18-year prison sentence for massive financial fraud at Archegos, marking a landmark moment in white-collar crime prosecution

Bill Hwang just got the hammer dropped – sentenced to 18 years for orchestrating a $36 billion market manipulation scheme. The judge compared his fraud to Bankman-Fried's, highlighting the devastating impact on major banks like Credit Suisse. A stark warning for financial predators.

CRYPTO

Bitcoin Reserve Won’t Solve US Debt Crisis: Think Tank Critique

Avik Roy, president of the Foundation for Research on Equal Opportunity, argues Senator Cynthia Lummis’ Bitcoin reserve proposal won’t fix the $35 trillion U.S. debt. While Bitcoin could ease bond market tensions, Roy stresses the need for budgetary reforms. Lummis' plan calls for 1 million BTC holdings and converting gold reserves, but skepticism remains about potential misuse, similar to 1970s gold reserves.

Bitcoin Nears $100K Amid 'Trump Trade' Surge

Bitcoin surged past $97,500, less than 3% away from the $100,000 mark, driven by pro-crypto policies under a Republican administration and Fed rate cuts. The rally, dubbed the "Trump trade," reflects heightened investor optimism, with BlackRock’s IBIT options hitting $2 billion in trading volume. Analysts project targets as high as $200,000 as institutional confidence solidifies BTC's mainstream appeal.

DCG Launches Yuma to Drive Decentralized AI on Bittensor

Digital Currency Group (DCG) introduced Yuma, a subsidiary aimed at boosting decentralized AI innovation on the Bittensor network. Yuma will fund and support startups utilizing Bittensor’s open marketplace for AI and machine learning models. Acting as a validator and incubator, Yuma enhances the ecosystem while Grayscale complements this effort with decentralized AI-focused funds.

ETH-to-BTC Ratio Hits March 2021 Low Amid Bitcoin's Surge to $97,700

The ETH-to-BTC price ratio fell to 0.032, its lowest since March 2021, as Bitcoin surpassed $97,700. Bitcoin’s rally, driven by pro-crypto sentiment and ETF approvals, contrasts with Ethereum’s underperformance due to competition from Solana and lingering regulatory uncertainties. Experts suggest Ethereum’s developer activity could spark future momentum, but short-term sentiment remains subdued.

GOLD

Gold Hits 7-Day Highs Amid Geopolitical Tensions

Gold rose to $2,665, regaining almost half of its post-election losses. Increased London gold vault holdings, central bank purchases, and Ukraine's missile strikes on Russia spurred demand for safe-haven assets. Silver hit $31.50 before retreating, while ETFs like GLD expanded holdings. UBS and Goldman Sachs project gold prices to reach $2,900–$3,000 by 2025 amid persistent geopolitical uncertainties.

DAILY ECONOMIC CALENDAR (ET)

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