Market Wrap: Bitcoin Trading Volume Dips; Dogecoin Rallies

Bitcoin traded in a tight range this week, which provided some relief to market participants after a volatile start to the year. The cryptocurrency was roughly flat over the past 24 hours and up about 3% over the past week, compared to a 5% gain in ether.

Some traders and analysts remain cautious despite the brief price bounce off $40,000 earlier this week.

"Price swings are all happening on wafer-thin volumes, which can amplify price movements," Q9 Capital, a Hong Kong-based crypto investing platform, wrote in a briefing on Friday. "No fresh capital is coming in and nobody is willing to sell or buy," Q9 wrote.

"Attempts earlier in the week to form a rebound are encountering more substantial selling, further indicating seller pressure," Alex Kuptsikevich, an analyst at FxPro, wrote in an email to CoinDesk.

Kuptsikevich is especially concerned about further declines in ether, the world's second-largest cryptocurrency by market capitalization after bitcoin. If momentum continues to deteriorate, he anticipates a worst-case scenario of $1,300-$1,700 ETH, which is roughly 50% below current price levels.

Highest Goods Inflation Since 1975

By Brian Maher

Today we are thunderstruck, lightningstruck, tonguestruck and dumbstruck…

That is because — by a marvelous miracle of God — the economic experts have finally struck bull’s-eye.

They had divined that December’s Consumer Price Index (CPI) would register 7% year over year.

Word came issuing from the United States Department of Labor this morning. December’s CPI did in fact register 7% year over year.

This 7% acceleration represents the greatest yearly consumer price inflation since 1982… 39 years distant. Reports CNBC:

The IPO Market Will See Fireworks in 2022

By Teeka Tiwari

I worked on Wall Street for 15 years as an executive and then another 10 years as a fund manager.

In 1991, I was the youngest vice president in Shearson Lehman history. And for anyone who doesn’t know, Shearson Lehman was a key player in the initial public offering (IPO) market for a century.

From Shearson Lehman, I went to Cowen & Co. It was recently ranked one of the top IPO banks in the world.

In all that time, I learned a lot about the inner workings of Wall Street. And the biggest lesson was that you never believe what Wall Street says… you look at it what it does instead.

Right now, Wall Street is in love with initial public offerings (IPOs). That’s when a private company lists its shares on a public exchange like the NYSE or Nasdaq.

Last year was the biggest IPO boom on record. More IPOs doubled in their debuts than in any year since the tech boom… And I believe 2022 could be even bigger.

Fed Drains $1.9 Trillion in Liquidity from Market via Overnight Reverse Repos

by Wolf Richter

Banks unloaded cash today for quarter-end window dressing. Money markets funds are biggest counterparties, Fidelity, Vanguard, Blackrock on top.

By Wolf Richter for WOLF STREET.

The New York Fed disclosed today that its overnight reverse repos (RRPs) spiked by $208 billion from yesterday, to a record $1.904 trillion. With these RRPs, the Fed took in $1.9 trillion in cash from 103 counterparties, and in exchange handed out Treasury securities, temporarily draining $1.9 trillion in liquidity from the market and financial system.

The RRPs mature on Monday, January 3, when the Fed gets its securities back and counterparties get their cash back. Then they’ll engage in another round of RRPs. Today’s RRPs replaced $1.70 trillion in RRPs from yesterday that matured and were unwound this morning.

Why Commodities Could Absolutely Soar in the Next Decade

By Dan Ferris

Stocks have been the best way for most folks to build real wealth with their savings over the long term...

Since the day before I was born, the S&P 500 has risen annually by an average of 7.2%. It doesn't sound like much, but it's a great return if you can keep it up for 60 years.

Every $10,000 invested 60 years ago is worth about $640,000 today. That's not bad for doing absolutely nothing for 60 years... though I must admit that someone probably doesn't have a lot of capital on hand the day they're born.

My point is... equities are near all-time-high valuations today, and anybody who has held them for decades knows they've been a tremendous long-term investment.

Get in Crash Positions

Everyone with some gray in their ponytails knows the stock market has ticked every box for a bubble top, so everybody get in crash positions.

Let’s run through the requirements for a bubble top:

1. Retail investors (i.e., dumb money) are all in and buying the dip with absolute confidence. As the gray-ponytail traders know, there are many moving parts to the retail dumb money going all in:

— The pain of the last bubble bursting has finally faded and been replaced by greed as retail punters watch everyone else mint fortunes by buying the dip and gambling with abandon at the casino’s trendy tables: crypto, NFTs, Mega-Tech, EVs, uranium, etc.

— Prudence and caution (i.e., holding cash in low-risk accounts) are thrown to the wind as the more money you put into the bet, the bigger the rewards