MARKET COMPASS
What stands out are the dynamics.
- US President Donald Trump has announced a 25% tariff on imports of automobiles, semiconductors and pharmaceuticals starting in early April.
- Wall Street futures and European stock markets turned negative after a weak open, weighed down by the “trade war” agenda and uncertainty over the situation in Ukraine.
- The greenback appreciated during European trading before paring its gains and the yield on the US 10-year treasury bond rose as high as 4.57%.
Major digital currencies are trying to recover their recent losses. Throughout the week, the macro agenda was secondary for asset prices, which were driven by tariffs and geopolitical developments. The minutes of the FED’s last Federal Open Market Committee (FOMC) meeting, which will be released today, may shift the focus a bit more to macro. We maintain our expectation of flat to volatile in the short term, slightly pressured in the medium term and bullish in the long term.
When is the Fed’s Next Rate Cut?
FED Chairman Powell, who made presentations in Congress last week, gave a message that there was no need to rush for interest rate cuts. This assessment implies that tight financial conditions in the US economy will continue for now. Following the tariff agenda and the latest macro indicators, markets do not expect another rate cut from the Fed before September, according to CME FedWatch. If the clues between the lines of the FOMC meeting minutes lead to a change in these expectations, the markets may move again.
If the Bank maintains its hawkish stance, we think that some of the recent losses in the dollar (the retreat in the DXY around February 12-14) may be reversed and this may put pressure on digital assets. The surprise scenario would be a more dovish tone, and although we think it is unlikely, in such a case, the rise in digital assets may gain ground even in the short term.
From the short term to the big picture.
Trump’s victory on November 5, one of the main pillars of our bullish expectation for the long-term outlook in digital assets, produced a result in line with our predictions. In the process that followed, the appointments made by the president-elect and the increasing regulatory expectations for the crypto ecosystem in the US, as well as the emergence of BTC as a reserve, continued to take place in our equation as positive variables. Then, 4 days after the new President took over the White House, he signed the “Cryptocurrency Working Unit” decree, which was among his election promises, and we think that the positive reflection of the outputs it will produce in the coming days on digital assets may continue.
On the other hand, the expectations that the FED will continue its interest rate cut cycle, albeit on hiatus for now, and the fact that the volume in crypto-asset ETFs indicates an increase in institutional investor interest, support our upside forecast for the big picture. In the short term, given the nature of the market and pricing behavior, we think it would not be surprising to see occasional pause or pullbacks in digital assets. However, at this point, it is worth underlining again that we think the fundamental dynamics continue to be bullish.
HIGHLIGHTS OF THE DAY
Important Economic Calender Data
| Time | News | Expectation | Previous |
|---|---|---|---|
| 19:00 | FOMC Meeting Minutes | ||
| 22:00 | FOMC Member Jefferson Speaks |
INFORMATION
*The calendar is based on UTC (Coordinated Universal Time) time zone.
The economic calendar content on the relevant page is obtained from reliable news and data providers. The news in the economic calendar content, the date and time of the announcement of the news, possible changes in the previous, expectations and announced figures are made by the data provider institutions. Darkex cannot be held responsible for possible changes that may arise from similar situations
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